Exhibit 99.1
FOR IMMEDIATE RELEASE
Financial Information Press Contact:
Vincent C. Klinges
Chief Financial Officer
American Software, Inc.
(404) 264-5477
AMERICAN SOFTWARE PROVIDES UPDATE ON ITS INCOME TAX PROVISION RESTATEMENT
ATLANTA (September 1, 2005) - American Software, Inc. (NASDAQ: AMSAE) today
provided an update on its fiscal 2005 income tax provision and earnings
adjustment.
The Company estimates that correcting an error in accounting for income taxes
during fiscal 2005 will require it to record an income tax expense for fiscal
2005 of approximately $1.7 million compared to an income tax benefit of $215,000
previously announced. A change in income tax expense as described above will
result in a reduction in the announced after-tax earnings and earnings per share
for the fiscal year ended April 30, 2005 from $5.2 million or $0.21 earnings per
share to approximately $3.3 million or approximately $0.13 earnings per share.
This adjustment will require the Company to restate the tax expense for the
third quarter of fiscal 2005 and file an amended Quarterly Report on Form 10-Q
for that period. The Company estimates that correcting the error in accounting
for income taxes will require it to record an income tax expense for both the
three and nine month periods ended January 31, 2005 of approximately $1.4
million, compared to an income tax expense of $286,000 previously reported for
both periods. A change in income tax expense as described above will result in a
reduction in the announced after-tax earnings and earnings per share for the
three-month period ended January 31, 2005, from $1.1 million or $0.04 earnings
per share, to approximately $20,000 or approximately zero earnings per share.
The change would result also in a reduction in the announced after-tax earnings
and earnings per share for the nine-month period, from $3.8 million or $0.15
earnings per share, to approximately $2.7 million or approximately $0.11
earnings per share.
The error related to the Company's income tax provision calculation and its
affect on the three and nine month periods ended January 31, 2005 are not
expected to impact the Company's cash flows for the periods in which the errors
occurred. These amounts are subject to change as the Company's review and the
audit of the Company's financial statements are not yet complete. While our
continuing review is not yet complete, it has progressed sufficiently to allow
us now to announce that we expect to restate and amend our financial statements
for the above periods.
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American Software Provides Update on its Income Tax Provision Page 2
ABOUT AMERICAN SOFTWARE, INC.
Headquartered in Atlanta, American Software develops, markets and supports one
of the industry's most comprehensive offerings of integrated business
applications, including supply chain management, Internet commerce, financial,
warehouse management and manufacturing packages. e-Intelliprise(TM) is an
ERP/supply chain management suite, which leverages Internet connectivity and
includes multiple manufacturing methodologies. American Software owns 89% of
Logility, Inc. (NASDAQ: LGTY), a leading provider of collaborative supply chain
solutions that help small, medium, large and Fortune 1000 companies realize
substantial bottom-line results in record time. Logility is proud to serve such
customers as Avery Dennison Corporation, Bissell, Huhtamaki UK, Hyundai Motor
America, Leviton Manufacturing Company, McCain Foods, Pernod-Ricard, Sigma
Aldrich and Under Armour Performance Apparel. New Generation Computing Inc.
(NGC), a wholly owned subsidiary of American Software, is a global software
company that has 25 years of experience developing and marketing business
applications for apparel manufacturers, brand managers, retailers and importers.
Headquartered in Miami, NGC's worldwide customers include Dick's Sporting Goods,
Wilsons Leather, Kellwood, Hugo Boss, Russell Corp., Ralph Lauren Childrenswear,
Haggar Clothing Company, Maidenform, William Carter and VF Corporation. For more
information on the Company, contact: American Software, 470 East Paces Ferry
Rd., Atlanta, GA 30305; (800) 726-2946 or (404) 261-4381. FAX: (404) 264-5206.
INTERNET: www.amsoftware.com or E-mail: ask@amsoftware.com
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that are subject to
substantial risks and uncertainties. There are a number of factors that could
cause actual results to differ materially from those anticipated by statements
made herein. These factors include, but are not limited to, changes in general
economic conditions, technology and the market for the Company's products and
services, including economic conditions within the e-commerce markets; the
timely availability and market acceptance of these products and services; the
challenges and risks associated with integration of acquired product lines and
companies; the effect of competitive products and pricing; the Company's ability
to satisfy in a timely manner the requirements of Section 404 of the
Sarbanes-Oxley Act of 2002 and the rules and regulations adopted under that
Section; the uncertainty of the viability and effectiveness of strategic
alliances; and the irregular pattern of the Company's revenues. For further
information about risks the Company could experience as well as other
information, please refer to the Company's Form 10-K for the year ended April
30, 2004 and other reports and documents subsequently filed with the Securities
and Exchange Commission. For more information, contact: Vincent C. Klinges,
Chief Financial Officer, American Software, Inc., (404) 264-5477 or fax: (404)
237-8868.
e-Intelliprise is a trademark of American Software, Logility is a registered
trademark and Logility Voyager Solutions is a trademark of Logility, and
REDHORSE is a trademark of New Generation Computing. Other products mentioned in
this document are registered, trademarked or service marked by their respective
owners.
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