MRO Software Reports Fourth Quarter and Fiscal 2005 Results

   Company Reports Record Fiscal Year Revenues,
    Quarterly Software License Revenues Grow 31 Percent Year Over Year

   MRO Software, Inc. (Nasdaq: MROI), the leading provider of asset
and service management solutions, today announced revenues of $55.4
million for the Company's fourth quarter and $199.2 million for the
fiscal year ended September 30, 2005.
   Total revenues for the fourth quarter were $55.4 million compared
with $49.9 million for the fourth quarter last year, an increase of 11
percent. Revenues for the fiscal year ended September 30, 2005 were
$199.2 million, compared with $185.7 million for the prior year, an
increase of 7 percent.
   On a GAAP basis, the Company reported net income for the fourth
quarter of $5.8 million or $0.22 per diluted share, compared with net
income of $4.1 million or $0.16 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, 2005, the Company reported net income
of $13.6 million or $0.52 per diluted share compared with a net income
of $10.3 million, or $0.41 per diluted share for the prior year, an
increase in EPS of 27 percent.
   In the fourth quarter of fiscal 2005, the Company recognized a tax
benefit of $3.4 million from the resolution of an IRS examination.
Without this tax benefit, the effective tax rate for the year would
have been 35.5 percent. In addition, in order to achieve the primary
goal of software revenue growth, the Company invested heavily in sales
and marketing initiatives which resulted in higher-than-expected sales
expenses. The Company also recorded several one-time, unusual charges,
the most significant being expenses related to the accelerated vesting
of employee stock options, and expenses related to the review and
audit of internal controls as required under Section 404 of the
Sarbanes-Oxley Act of 2002.
   The Company also reports net income on a non-GAAP basis (see
Schedule A). Non-GAAP results are adjusted for the amortization of
acquired technology and other intangibles and the related tax effects.
Non-GAAP net income for the fourth quarter was $6.1 million, or $0.23
per diluted share compared with non-GAAP net income of $4.6 million or
$0.18 per diluted share for same quarter last year, an increase in EPS
of 28 percent. For the fiscal year ended September 30, 2005, the
Company reported non-GAAP net income of $15.2 million, or $0.58 per
diluted share compared with non-GAAP net income of $12.6 million, or
$0.50 per diluted share for the prior year, an increase in EPS of 16
percent. Beginning in the first quarter of fiscal year 2006, the
Company will no longer report its results on a non-GAAP basis.
   For the fourth quarter, software license revenues were $20.9
million, compared with $15.9 million for the same quarter last year,
an increase of 31 percent. Support and services revenues were $34.5
million for the fourth quarter, compared with $33.9 million for the
same quarter last year, an increase of 2 percent.
   For fiscal year ended September 30, 2005, software license
revenues were $65.1 million compared with $52.6 million for the prior
year, an increase of 24 percent. Support and services revenues for the
fiscal year ended September 30, 2005, were $134.1 million compared
with $133.1 million for the prior year, an increase of 1 percent.
   During the fourth quarter, the Company sold 265 software licenses
into a broad range of industries. The Company sold more than 30 MXES
licenses, including several customers that purchased the entire Maximo
Enterprise Suite of functionality. Customers that purchased MRO
Software solutions during the quarter included: Alcatel Portugal, BP
Oil International Ltd, China National Offshore Oil Company (CNOOC),
Chiron Corp, Computer Sciences Corporation (CSC), Getronics, Guangzhou
Hengyun Power Generation, Honeywell International, Kellog Brown &
Root, Kuwait Drilling Company, NYC Department of Transportation,
Sacramento Regional Wastewater, Shanghai Zhabei Power Plant, Southwest
Airlines, Tampa Port Authority, The Bureau of Engraving and Printing,
University of Alabama, U.S. Air Force, U. S. Department of Energy, U.
S. Department of State, and the U.S. Navy.
   The balance sheet as of September 30, 2005 contained $133.2
million in cash and marketable securities and no long-term debt. This
compares with $108.4 million in cash and marketable securities as of
September 30, 2004, and represents a 23 percent increase
year-over-year. For the fourth quarter, deferred revenue was $32.3
million, and days sales outstanding (DSO) was 66.
   "Looking back on fiscal 2005, we achieved a number of significant
milestones for the Company," said Chip Drapeau, president and CEO, MRO
Software. "In the second quarter we successfully launched Maximo
Enterprise Suite, the largest product development project in our
history. We executed our industry specific solution strategy for
targeted markets producing robust sales results. And finally, total
revenues for the fourth quarter were the highest in our history which
in turn delivered our highest total revenues for a fiscal year."
   "Our focus on software sales growth returned strong top-line
results and allowed us to increase earnings and cash," said Peter
Rice, executive vice president and CFO, MRO Software. "Looking ahead
to fiscal 2006, we are confident that operating margins will improve
as sales expenses normalize after our initial MXES roll-out, and the
one-time unusual charges, taken in the fourth quarter, are
eliminated."
   For fiscal year 2006, the Company maintains the guidance provided
last quarter, and expects overall revenue growth to be in the range of
5 to 10 percent above fiscal 2005 results. Software revenues are
expected to grow in the range of 10 to 20 percent. As a result, the
Company expects GAAP EPS to grow in the range of 15 to 25 percent over
fiscal 2005 results. The Company expects software revenues for the
first half of fiscal 2006 to be in the range of $28 million to $32
million.
   The Company will conduct its regularly scheduled fiscal fourth
quarter and year end 2005 conference call on Thursday, November 3 at
4:30 p.m. EST.
   To participate in this call within the U.S. and Canada, dial (800)
932-9896, international callers should dial [phone]. A digital
recording of the call will be available beginning two hours after the
call and will be available through November 13, 2005. To access the
replay within the U.S. and Canada, dial [phone], international
callers should dial [phone]; all participants should use
conference ID: 1466377.
   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 asset and service
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, and more than 300,000
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 customer
acceptance of our new Maximo Enterprise Suite product or weak
penetration into markets that are new to the Company, slower than
anticipated sales from new channels being emphasized by the Company,
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 Enterprise Suite(R) are registered
trademarks, and MRO Software(TM) and MXES(TM) are trademarks, of MRO
Software, Inc.

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                          MRO SOFTWARE, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                              (unaudited)

                                      Three Months       Twelve Months
                                       Ended              Ended
                                      September 30,      September 30,
                                    --------------- ------------------
                                       2005    2004      2005     2004
                                    ------- ------- --------- --------
(in thousands, except per share
 data)
        Revenues:
            Software                $20,884 $15,925 $ 65,115 $ 52,583
            Support and services     34,520  33,940  134,054  133,106
                                     ------- ------- -------- --------
                     Total revenues  55,404  49,865  199,169  185,689
                                     ------- ------- -------- --------

        Cost of revenues:
            Software                  1,525   1,335    5,056    4,739
            Support and services     17,332  15,004   65,708   60,144
            Amortization of acquired
             technology                 519     519    2,075    2,404
                                     ------- ------- -------- --------
                     Total cost of
                      revenues       19,376  16,858   72,839   67,287
                                     ------- ------- -------- --------

        Gross profit                 36,028  33,007  126,330  118,402

        Operating expenses:
            Sales and marketing      18,635  15,276   63,078   56,762
            Product development       7,693   7,388   29,614   28,492
            General and
             administrative           6,753   4,705   20,087   17,839
            Amortization of other
             intangibles                 75      92      347      666
                                     ------- ------- -------- --------
                     Total operating
                      expenses       33,156  27,461  113,126  103,759
                                     ------- ------- -------- --------

        Income from operations        2,872   5,546   13,204   14,643

            Interest income, net      1,145     497    2,956    1,258
            Other (expense)/income,
             net                       (433)    298     (355)       6
                                     ------- ------- -------- --------

        Income before income taxes    3,584   6,341   15,805   15,907

        (Benefit)/provision for
         income taxes                (2,167)  2,240    2,210    5,567
                                     ------- ------- -------- --------

        Net income                  $ 5,751 $ 4,101 $ 13,595 $ 10,340
                                     ======= ======= ======== ========

       Net income per share, basic  $  0.23 $  0.16 $   0.54 $   0.42
                                     ------- ------- -------- --------
       Net income per share, diluted$  0.22 $  0.16 $   0.52 $   0.41
                                     ------- ------- -------- --------

        Shares used to calculate net
         income per share
             Basic                   25,484  24,947   25,280   24,795
             Diluted                 26,456  25,090   25,901   25,273


                          MRO SOFTWARE, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS
                         Non-GAAP Presentation
                              Schedule A
                              (unaudited)

                                       Three Months     Twelve Months
                                        Ended            Ended
                                       September 30,    September 30,
                                      --------------- ----------------
                                         2005    2004    2005    2004
                                      ------- ------- ------- --------
(in thousands, except per share data)

GAAP net income                       $ 5,751 $ 4,101 $13,595 $10,340

        Adjustments to GAAP net income
--------------------------------------

        Amortization of other
         intangibles                       75      92     347     666
        Amortization of acquired
         technology                       519     519   2,075   2,404
        Related tax effects              (208)   (156)   (847)   (844)
                                       -------------------------------
        Total adjustments                 386     455   1,575   2,226

   Non-GAAP net income, as adjusted   $ 6,137 $ 4,556 $15,170 $12,566
                                       ------- ------- ------- -------


   Non-GAAP diluted net income per
    share, as adjusted                $  0.23 $  0.18 $  0.58 $  0.50
                                       ------- ------- ------- -------

   Shares used to calculate non-GAAP
    net income per share, as adjusted  26,456  25,090  25,901  25,273

    Note:

    In this press release, the Company has reported its net income and
    earnings per share (EPS) on a GAAP basis. Also, in the press
    release, we reported our GAAP net income and EPS as adjusted
    for the exclusion of certain items, and we refer to this as
    non-GAAP net income and EPS. Non-GAAP net income and EPS for
    fiscal years 2005 and 2004 have been adjusted to exclude the
    amortization of acquired technology and other intangibles and
    the related tax effects.

    Management believes that such non-GAAP financial measures are
    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. The Company has reported its
    results to investors on both a GAAP and non-GAAP basis for
    over five years. Second, the Company's amortization of
    acquired technology and other intangibles relates to
    acquisitions consummated in prior fiscal years, is
    substantially fixed, is relatively large in comparison with
    the absolute value of the Company's operating income, and
    therefore this amortization expense is a material component of
    GAAP earnings for the current period that is a result of
    historic decisions and actions taken by the Company and its
    management. The Company believes that by focusing on the
    impact of operating expenses that are to a greater extent
    subject to control by the Company's management and decisions
    taken in the current periods, non-GAAP EPS provides investors
    with a more direct perspective on the performance of the
    Company and its management.

    The Company uses this non-GAAP financial measure to conduct or
    evaluate its business, in that these same non-GAAP financial
    measures are utilized for purposes of determining the
    compensation of our executive officers and other employees in
    the Company having variable compensation based upon the
    Company's financial performance. The Company believes that
    these non-GAAP measures more closely reflect the impact of
    items that are within management's immediate control, and are
    a true reflection of management's current impact on the
    Company's performance.



                          MRO SOFTWARE, INC.
                 CONDENSED CONSOLIDATED BALANCE SHEETS
                              (unaudited)

                                                   September September
                                                         30,      30,
                                                        2005     2004
                                               -----------------------
(in thousands)                                 ASSETS

Cash and cash equivalents                           $120,301 $ 56,982
Marketable securities                                  5,130   36,152
Accounts receivable, net                              40,362   36,636
Other current assets                                   6,205    6,542
                                                     -------- --------
         TOTAL CURRENT ASSETS                        171,998  136,312
                                                     -------- --------

Marketable securities                                  7,743   15,273
Property and equipment, net                            7,210    7,227
Intangible assets, net                                49,455   52,309
Other assets                                           9,964   11,600
                                                     -------- --------
         TOTAL ASSETS                               $246,370 $222,721
                                                     ======== ========

                 LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities                                 $ 30,116 $ 28,778
Deferred revenue                                      31,718   29,373
                                                     -------- --------
         TOTAL CURRENT  LIABILITIES                   61,834   58,151
                                                     -------- --------

Other long term liabilities                            2,830    3,435
                                                     -------- --------
         TOTAL LIABILITIES                            64,664   61,586
                                                     -------- --------


         STOCKHOLDERS' EQUITY                        181,706  161,135
                                                     -------- --------

              TOTAL LIABILITIES &
               STOCKHOLDERS' EQUITY                 $246,370 $222,721
                                                     ======== ========
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