Manatron Announces Fiscal 2007 Fourth Quarter & Full-Year Results

Highlights: - Net revenue growth of 15.1% for the full year - Software license fees for FY 07 increased by nearly 100% to $5.3 million vs. FY 06 - Gross margin grew to 53% for the quarter compared to 31% for FY 06 - Operating income was $1.2 million for FY 07, a positive swing of over $8 million compared to the operating loss of $6.9 million for FY 06 - Cash and short-term investments increased $3.4 million to $7.6 million at year-end after paying down acquisition related debt of nearly $3 million and repurchasing $490,000 of Manatron stock during FY 07 - New GRM(R) contracts totaling $5.8 million were signed during the fourth quarter 


KALAMAZOO, Mich., June 28  /PRNewswire-FirstCall/ -- Manatron, Inc. (NASDAQ:MANA) the nation's leading provider of property tax solutions for state and local governments, announced its financial results for the fourth quarter and full year of fiscal 2007, which ended on April 30, 2007. For the fourth quarter, the Company reported net revenues of $10.1 million, a slight increase over the net revenues of $9.9 million that were recognized in the prior year fourth quarter. This marked the fourth consecutive quarter in which revenues exceeded $10 million. The Company's gross margin grew to $5.4 million, or 53.1 percent of net revenues in the fourth quarter, compared to $3.1 million or 31.4 percent of net revenues for the same period in fiscal 2006. Operating income improved to $311,000 for the quarter, a positive swing of $2.6 million versus the operating loss of $2.3 million that was reported for fourth quarter of the prior fiscal year. Net income after taxes was $328,000, or $0.06 per diluted share, compared to a net loss of $1.6 million or $(0.33) per diluted share for the three months ended April 30, 2006.

For the full year, the Company reported net revenues of $41.8 million, which is a 15.1 percent increase over the net revenues of $36.3 million that were posted in fiscal 2006. Gross margin improved to $20.4 million, or 48.9 percent of net revenues, compared to $11.1 million, or 30.6 percent of net revenues in the prior year. Operating income improved to $1.2 million for the year, representing a positive swing of $8.1 million over the operating loss of $6.9 million that was reported last year. Net income was $946,000 or $0.19 per diluted share for the year ended April 30, 2007 compared to a net loss of $4.3 million or $(0.97) per diluted share for fiscal 2006.

"Our financial performance during every quarter of fiscal 2007 showed marked improvement over the prior year," said Paul Sylvester, Manatron's Chief Executive Officer. "While much of this was due to a reduction in our payroll cost as a result of the restructuring we initiated a little over a year ago, the ASIX acquisition, further penetration of our GRM(R) software in the market and solid momentum in Ohio were major contributors to our progress in fiscal 2007. We have clearly moved forward toward our goal of positioning Manatron as the nation's leading provider of property tax solutions."

"Our turn-key GRM(R) suite of software, built on Microsoft's .Net platform, continues to gain market acceptance as a standard for excellence and is benefitting from a more substantial and vocal list of reference accounts," added Bill McKinzie, Manatron's President and Chief Operating Officer. "In the last two fiscal years, we have announced over $15 million of new GRM(R) business in Kansas, Minnesota, Nevada, South Carolina and Tennessee. GRM(R) is scheduled to go live in six new states during fiscal 2008, which will significantly increase the number of satisfied clients using our new software and better equip us to enter new markets and expand our share of existing markets in the years ahead."

Backlog for software license fees and services at the end of the fourth quarter was $21 million compared to $23 million at April 30, 2006. The Company reported that this number is exclusive of recurring revenue from software maintenance, hardware maintenance, e-government subscriptions, and printing and processing contracts, which currently approximates $21.7 million on an annualized basis.

"Our backlog is lower than the prior year primarily because of a decrease in our appraisal service contracts and backlog during the past year," Mr. Sylvester continued. "We did meet our sales plan for fiscal 2007, signing $20.6 million of new contracts, which was an 8.5 percent increase over the $19.0 million that we signed in fiscal 2006. Over $5 million of the current year backlog amount relates to our recently announced GRM(R) contracts with Sedgwick County, Kansas, Wyandotte County, Kansas and Beaufort County, South Carolina. As a result, we expect to continue our current momentum in fiscal 2008."

The Company finished the year with working capital of $5.1 million, $7.6 million in cash and short-term investments and no bank debt. Shareholders' equity was $24.5 million compared to $23.0 million as of April 30, 2006. Manatron also made payments of approximately $3 million on its seller-financed notes payable associated with previous acquisitions leaving a $2.2 million balance due at year end. The Company also repurchased 61,000 shares of its common stock totaling $490,000 for the year.

Teleconference Information

Management will discuss the results in a conference call, scheduled for 4:15 p.m. Eastern Time, on Thursday, June 28, 2007. Anyone interested in participating should call 888-694-4641 if calling within the United States or 973-582-2734 if calling internationally.  There will be a playback available until July 5, 2007.  To listen to the playback, please call 877-519-4471 if calling within the United States or 973-341-3080 if calling internationally. Please use pin number 8937213 for the replay.  This call is being web cast by ViaVid Broadcasting and can be accessed at Manatron's website at http://www.manatron.com/.  The web cast may also be accessed at ViaVid's website at http://www.viavid.net/. The web cast can be accessed until July 28, 2007 on either site. To access the web cast, you will need to have the Windows Media Player on your desktop. For the free download of the Media Player please visit: http://www.microsoft.com/windows/windowsmedia/en/download/default.asp.

About Manatron, Inc.: Manatron is focused on providing software and services to enable state and local governments in North America to completely, fairly and efficiently assess real and personal property, and to bill and collect the related property taxes in their jurisdictions.  The Company's software manages the entire property life cycle, which includes deed recording, land records, GIS (Geographic Information System) integration, valuation, assessment administration, personal property, business licenses, cashiering, tax billing and collection, delinquents and tax sales, and e- government. Manatron's revenues are primarily generated from software license fees, software maintenance fees, professional services, and sales of hardware and supplies.  Professional services consist of data conversions, installation, training, project management, hardware maintenance, forms processing and printing, consulting and appraisal services. Manatron is headquartered in Portage, Michigan and has offices in Florida, Georgia, Illinois, Indiana, Minnesota, Ohio, Pennsylvania, and Washington. Manatron currently serves approximately 1,300 customers in 30 states and two Canadian territories. More information about Manatron, Inc. is available at the Company's site on the World Wide Web at http://www.manatron.com/.

About GRM(R): GRM(R) is Manatron's fully integrated property management suite of software designed to manage and support the entire property life cycle, which includes deed recording, land records, GIS (Geographic Information System) integration, valuation, assessment administration, personal property, business licenses, cashiering, tax billing and collection, delinquents and tax sales, and e-government. Manatron GRM automates the operational, information and planning needs for Assessors, Auditors, Treasurers, Tax Collectors, Recorders and other state and local governmental officials so that they can completely, fairly and efficiently assess real and personal property and bill and collect the related property taxes in their jurisdictions. More information on this product is available at http://www.manatron.com/solutions/GRM.aspx.

Safe Harbor Statement: The information provided in this news release may include forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. Actual results may differ from such projections and are subject to certain risks including, without limitation, risks arising from: changes in the rate of growth of the local government market, increased competition in the industry, delays in developing and commercializing new products, adequacy of financing and other factors described in the Company's most recent annual report on Form 10-K filed with the Securities and Exchange Commission, which can be reviewed at http://www.sec.gov/.

                      MANATRON, INC. AND SUBSIDIARY
                  CONDENSED CONSOLIDATED BALANCE SHEETS


                                                      April 30,    April 30,
                                                        2007         2006
                                                      (Audited)    (Audited)
                        ASSETS
  CURRENT ASSETS:
    Cash and equivalents                              $7,057,403  $3,714,685
    Short-term investments                               495,146     495,146
    Accounts receivable, net                           5,498,816   7,556,313
    Income tax receivable                                346,075   2,062,248
    Revenues earned in excess of billings on
     long-term contracts                               4,813,083   6,151,346
    Unbilled retainages on long-term contracts           745,409   1,105,320
    Notes receivable                                     256,874     450,565
    Inventories                                           86,059     146,800
    Deferred tax assets                                1,002,412   1,273,651
    Other current assets                                 387,312     485,525
            Total current assets                      20,688,589  23,441,599
  NET PROPERTY AND EQUIPMENT                           2,264,969   2,618,588
  OTHER ASSETS:
    Notes receivable, less current portions               98,770     272,261
    Computer software development costs, net of        3,699,498   2,610,216
     accumulated amortization
    Goodwill                                          12,022,385  12,022,385
    Intangible assets, net of accumulated
     amortization                                      2,240,763   3,202,935
    Other, net                                           318,678     253,980

            Total other assets                        18,380,094  18,361,777

            Total assets                             $41,333,652 $44,421,964


          LIABILITIES AND SHAREHOLDERS' EQUITY
  CURRENT LIABILITIES:
    Accounts payable                                    $676,435    $898,301
    Current portion of notes payable                   1,500,000   2,700,000
    Billings in excess of revenues earned on
     long-term contracts                               1,198,357   3,373,271
    Billings for future services                       9,275,681   8,369,114
    Accrued liabilities                                2,926,399   3,419,286
            Total current liabilities                 15,576,872  18,759,972

  DEFERRED INCOME TAXES                                  587,000     284,963
  LONG-TERM PORTION OF NOTES PAYABLE                     653,193   2,334,228
  SHAREHOLDERS' EQUITY:
    Common stock                                      17,066,189  16,538,483
    Retained earnings                                  7,450,398   6,504,318
            Total shareholders' equity                24,516,587  23,042,801
            Total liabilities and shareholders'
             equity                                  $41,333,652 $44,421,964



                      MANATRON, INC. AND SUBSIDIARY
             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


                                Three Months Ended        Year Ended
                                    April 30,              April 30,
                                   (Unaudited)             (Audited)
                                2007        2006        2007       2006

  NET REVENUES              $10,080,141  $9,909,583 $41,795,564 $36,324,396

  COST OF REVENUES            4,728,732   6,795,931  21,366,969  25,194,840

            Gross profit      5,351,409   3,113,652  20,428,595  11,129,556

  SELLING, GENERAL AND
   ADMINISTRATIVE EXPENSES    5,040,696   4,853,308  19,217,163  17,491,957
  RESTRUCTURING CHARGE               --    (532,421)         --    (532,421)
           Income (loss) from
            operations          310,713  (2,272,077)  1,211,432  (6,894,822)
  OTHER INCOME (EXPENSE), NET    95,338     (29,170)    185,439     177,908
  Income (loss) before
   provision (credit) for       406,051  (2,301,247)  1,396,871  (6,716,914)
     income taxes
  PROVISION (CREDIT) FOR
   INCOME TAXES                  78,191    (722,815)    450,791  (2,400,255)
  NET INCOME (LOSS)            $327,860 $(1,578,432)   $946,080 $(4,316,659)
  BASIC EARNINGS (LOSS)
   PER SHARE                       $.07       $(.33)       $.19       $(.97)
  DILUTED EARNINGS (LOSS) PER
   SHARE                           $.06       $(.33)       $.19       $(.97)
  BASIC WEIGHTED AVERAGE
   SHARES OUTSTANDING         4,899,412   4,808,776   4,896,086   4,463,838
  DILUTED WEIGHTED AVERAGE
   SHARES OUTSTANDING         5,162,094   4,808,776   5,005,747   4,463,838


DATASOURCE: Manatron, Inc.



CONTACT:  Paul Sylvester, Co-Chairman and CEO of Manatron, Inc.,

[phone], ; or Cameron Donahue of Hayden

Communications, Inc., [phone], , for Manatron,

Inc.



Web site:  http://www.manatron.com/ 

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