Exhibit 99.1
Financial Information Press Contact:
Vincent C. Klinges
Chief Financial Officer
American Software, Inc.
(404) 264-5477
AMERICAN SOFTWARE REPORTS PRELIMINARY FIRST QUARTER OF FISCAL YEAR 2006 RESULTS
REVENUES INCREASE 22% AND OPERATING INCOME INCREASES 36%
ATLANTA (September 7, 2005) - American Software, Inc. (NASDAQ: AMSAE) today
reported preliminary financial results for the first quarter of fiscal year
2006. These results are preliminary pending the completion of the Company's
review and the audit of the Company's financial statements for fiscal 2005, the
filing of the Company's annual report on Form 10-K and the completion and filing
of the first quarter fiscal year 2006 Form 10-Q. These amounts are subject to
change as the Company's review and the audit of the Company's fiscal 2005
financial statements and the Company's review of the first quarter fiscal year
2006 are not yet complete.
Key estimated financial highlights for American Software include:
o Software license fees for the quarter ended July 31, 2005 were
approximately $3.4 million, an increase of 35% over the first
quarter of fiscal 2005;
o Services and other revenues for the quarter ended July 31, 2005 were
approximately $7.7 million, an increase of 13% over the first
quarter of fiscal 2005;
o Maintenance revenue fees for the quarter ended July 31, 2005 were
approximately $5.6 million, an increase of 29% over the first
quarter of fiscal 2005;
o Total revenues for the quarter ended July 31, 2005 were
approximately $16.8 million, an increase of 22% over the first
quarter of fiscal 2005; and
o Operating Income for the quarter ended July 31, 2005 was $770,000,
an increase of 36% over the first quarter of fiscal 2005.
Preliminary GAAP net earnings were approximately $1.1 million or $0.04 per
fully diluted share for the first quarter of fiscal 2006 compared to $1.2
million or $0.05 per fully diluted share for the same period last year. Adjusted
net earnings for the quarter ended July 31, 2005, which excludes the acquisition
related intangibles costs were $1.2 million or $0.05 earnings per fully diluted
share compared to $1.2 million or $0.05 earnings per fully diluted share for the
same period last year. The first quarter of fiscal 2005 financial data does not
include revenue or expenses from Logility's Demand Management subsidiary, as the
Demand Management acquisition occurred on September 30, 2004.
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American Software First Quarter Fiscal Year 2006 Results Page 2
The Company is including adjusted net earnings and adjusted net earnings
per share in the summary financial information provided with this press release
as supplemental information relating to its operating results. This financial
information is not in accordance with, or an alternative for, GAAP and may be
different from non-GAAP net earnings and non-GAAP per share measures used by
other companies. The Company believes that this presentation of adjusted net
earnings and adjusted net earnings per share provides useful information to
investors regarding certain additional financial and business trends relating to
its financial condition and results of operations.
"We are off to a solid start for fiscal year 2006. With impressive
growth in license fee, services and maintenance revenues, we delivered a 36%
increase in operating income for the first quarter," stated James C. Edenfield,
president and CEO of American Software. "As a respected enterprise application
provider, American Software has been serving the industry for 35 years. The
Company has the scale and resources to support our extensive customer base while
continuing to invest in enhancements and long-term product innovation. Both
current and future customers will benefit from our focus on demand-driven
enterprise solutions and deep supply chain management expertise."
The overall financial condition of the Company remains strong with cash
and investments of approximately $57.7 million and no debt as of July 31, 2005.
During the quarter, our 89% owned subsidiary, Logility purchased approximately
272,000 of its shares on the open market under the current stock buyback program
at a cost of approximately $1.6 million. There are approximately 269,000 shares
remaining to purchase under Logility's current stock buyback authorization.
ADDITIONAL HIGHLIGHTS FOR THE FIRST QUARTER OF FISCAL YEAR 2006 INCLUDE:
CUSTOMERS
o Notable new and existing customers placing orders with American
Software, Inc. in the first quarter include Ames True Temper Company,
Cole-Parmer, Dixie-Pacific, Franco Manufacturing, GKN AeroSpace, Inc.,
Greco Apparel, Hansen Beverage, Kidde, KR Castlemaine Foods, Intradesa,
Louisiana Pacific Corporation, Nutra Manufacturing, Wm. Wrigley Jr.
Company, Standard Motor Products, Tristan & America, Ventura Foods and
W.S. Badcock Home Furniture.
o New Generation Computing Inc. (NGC), a wholly owned subsidiary of
American Software, announced that Greco Apparel Inc. selected NGC's
RedHorse, a comprehensive enterprise resource planning (ERP) system
designed specifically for apparel and sewn products enterprises. NGC's
RedHorse system will help enable the Greco Apparel increase its speed to
market, reduce costs, manage by exception and improve workflow.
o Farley's & Sathers Candy Company Inc. announced selection of Logility
Voyager Solutions(TM) as part of a corporate-wide initiative to improve
forecast accuracy, optimize inventory investments and extend its
production planning horizon for greater supply chain flexibility and
efficiency.
o AberdeenGroup highlighted a Logility consumer goods customer in a "Best
Practices in Transportation Management" report for excellence in
customer service and warehouse optimization, and for significant freight
savings over the past three consecutive years. The consumer goods
company uses Logility Voyager Transportation Planning & Management(TM)
to help save time, labor and freight costs by automating shipment
planning and execution all while improving customer service with a
tightly integrated order fulfillment process.
American Software First Quarter Fiscal Year 2006 Results Page 3
o The Coleman Company, Inc., manufacturer and distributor of products for
camping, backpacking, tailgating, backyard grilling and other outdoor
leisure-time activities, extended its use of Logility Voyager Solutions
to include the latest version of Transportation Planning and Management
with Internet-enabled carrier collaboration. The Coleman Company
implemented the software on budget and on time in under five months.
PRODUCTS AND TECHNOLOGY
o Logility, the Company's 89% owned subsidiary, held its latest Supply
Chain Power Hour webcast, "Hit the Road: Reduce Costs and Improve
Service with Automated Transportation Management." The webcast helped
educate logistics and transportation executives about the latest
technology to help improve customer service and retailer compliance
while simultaneously aiding collaboration and reducing the amount of
paperwork between shippers and carriers. Speakers participated from The
Coleman Company, Inc., Adjoined Consulting and Logility.
o Global Logistics and Supply Chain Strategies magazine named Logility to
its third annual "100 Great Supply Chain Partners Report." The report is
the result of a six-month poll that asked logistics and supply chain
professionals to nominate vendors and service providers whose solutions
help drive overall business performance.
o Inbound Logistics magazine named Logility as a 2005 Top 100 Logistics IT
Provider for the eighth consecutive year. The selection process included
comparison of more than 500 logistics IT providers and their ability to
deliver solutions to meet the diverse needs of the Inbound Logistics'
readers.
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, BP (British Petroleum),
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
Company's ability to satisfy in a timely manner all SEC required filings and the
requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and the rules and
regulations adopted under that Section; the challenges and risks associated with
integration of acquired product lines and companies; the effect of competitive
products and pricing; the uncertainty of the viability and effectiveness of
strategic alliances; and the irregular pattern of the Company's revenues.
American Software First Quarter Fiscal Year 2006 Results Page 4
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, 2005 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.
###
AMERICAN SOFTWARE, INC.
Consolidated Statements of Operations
(In thousands, except per share data)
(Preliminary and Unaudited)
First Quarter Ended
July 31,
---------------------------------
Pct
2005 2004 Chg.
--------- --------- ---------
Revenues:
License $3,443 $2,557 35%
Services & other 7,688 6,779 13%
Maintenance 5,635 4,369 29%
Total Revenues 16,766 13,705 22%
Cost of Revenues:
License 1,030 903 14%
Services & other 5,529 4,719 17%
Maintenance 1,568 1,158 35%
Total Cost of Revenues 8,127 6,780 20%
Gross Margin 8,639 6,925 25%
Operating expenses:
Research and development 2,128 1,812 17%
Less: capitalized development (617) (670) (8%)
Sales and marketing 3,111 2,895 7%
General and administrative 3,160 2,323 36%
Acquisition related amortization of
intangibles 87 - nm
Total operating expenses 7,869 6,360 24%
Operating earnings 770 565 36%
Interest income & Other, net 1,117 633 76%
Earnings before income taxes and
minority interest 1,887 1,198 58%
Income tax provision/(benefit) 675 0 nm
Minority interest (105) (48) (119%)
Net Earnings $1,107 $1,150 (4%)
Earnings per common share:
Basic: $0.05 $0.05 --
Diluted: $0.04 $0.05 (20%)
Weighted average number of common
shares outstanding
Basic 23,970 23,563
Diluted 25,104 25,058
Reconciliation of Adjusted Net Income:
Net Earnings (loss) $1,107 $1,150 (4%)
Acquisition related amortization of
intangibles 87 - nm
Adjusted Net Earnings $1,194 $1,150 4%
Adjusted Net Earnings per Diluted Share $0.05 $0.05 0%
nm- not meaningful
Preliminary - See press release narrative
Selected Balance Sheet Items
(in thousands)
(Preliminary and Unaudited)
July 31,
---------------------
2005 2004
--------- ---------
Cash and Short & Long term investments $57,740 $67,134
Accounts Receivable:
Billed 9,410 5,546
Unbilled 3,429 3,069
Total Accounts Receivable,net 12,839 8,615
Deferred Revenues 14,304 9,987
Preliminary - See press release narrative