Ross Systems (NASDAQ:ROSS)
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Ross Systems 1st Quarter Report
Company reports 3% increase in Revenue over prior year
ATLANTA, Oct. 31 /PRNewswire-FirstCall/ -- Ross Systems, Inc. , a leading
provider of enterprise software solutions for manufacturers, today announced
results for its first fiscal quarter, which ended September 30, 2003. Operating
earnings were $0.3 million, before merger transaction costs associated with the
previously announced merger with CDC Software, a subsidiary of chinadotcom. The
company reported a net loss of $0.5 million or $0.19 per share, after merger
transaction costs of $0.8 million. The Company also reported that the Hart Scott
Rodino waiting period has elapsed without challenge and that the merger, subject
to stockholder approval, is expected to proceed as previously forecast during
the first quarter of calendar 2004.
Revenues for the quarter at $11.7 million increased from $11.4 million in the
prior year's same quarter. The net loss for the quarter of $0.5 million or $0.19
per share, compared to a net profit of $0.6 million or $0.20 per diluted share
in the prior year's same quarter.
Net cash of $7.9 million this quarter increased $3.3 million over the prior
year's same quarter and declined $0.7 million from the previous quarter,
reflecting the merger transaction costs incurred during the quarter.
The Company has no long-term debt, and deferred revenues this quarter declined
to $10.1 million from $10.6 million in the prior year. Accounts receivable, at
$11.7 million, increased from $10.9 million in the prior year. Accounts
receivable turnover at 84 days increased slightly compared to 77 days in the
prior year's same quarter and improved 11 days from the sequential quarter.
"Contributing to this quarter's results were sales of our Internet Application
Framework (IAF) and related browser capabilities to improve user productivity as
well as our Supply Chain Management (SCM) and Customer Relationship Management
(CRM) products. We have had great success in introducing these products to our
new and existing customers in both North America and Europe. We are also
pleased that our existing customers continue to upgrade and are implementing
additional iRenaissance applications," said J. Patrick Tinley, Ross' Chairman
and CEO.
About Ross Systems
Ross Systems, Inc. (NASDAQ:ROSS) delivers innovative software solutions that
help manufacturers worldwide fulfill their business growth objectives through
increased operational efficiencies, improved profitability, strengthened
customer relationships and streamlined regulatory compliance. Focused on the
food and beverage, life sciences, chemicals, metals and natural products
industries and implemented by over 1,000 customer companies worldwide, the
company's family of Internet-architected solutions is a comprehensive, modular
suite that spans the enterprise, from manufacturing, financials and supply chain
management to customer relationship management, performance management and
regulatory compliance.
Publicly traded on the Nasdaq since 1991, Ross's global headquarters are based
in the U.S. in Atlanta, Georgia, with sales and support operations around the
world. http://www.rossinc.com/ .
STATEMENTS IN THIS ANNOUNCEMENT, WHICH EXPRESS THAT THE COMPANY "BELIEVES,"
"ANTICIPATES," "EXPECTS," "PLANS TO..." OR "SHOULD BEGIN TO ... " AS WELL AS
OTHER STATEMENTS, WHICH ARE NOT HISTORICAL FACT, ARE FORWARD- LOOKING STATEMENTS
WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
FORWARD-LOOKING STATEMENTS IN THIS ANNOUNCEMENT INCLUDE STATEMENTS ABOUT THE
PROPOSED MERGER. ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY AS A RESULT OF
RISKS AND UNCERTAINTIES, INCLUDING THE RISK THAT THE MERGER IS NOT APPROVED BY
ROSS SHAREHOLDERS OR IS OTHERWISE NOT COMPLETED, THE RISK THAT THE ANTICIPATED
BENEFITS OF THE MERGER ARE NOT REALIZED, QUARTERLY FLUCTUATION OF SOFTWARE
PRODUCT LICENSE REVENUE, WEAKENING OF CUSTOMER DEMAND FOR ENTERPRISE SYSTEMS,
THE COMPANY'S MAINTENANCE OF A MINIMAL BACKLOG, THE UNCERTAINTY OF DEMAND FOR
NEW PRODUCT OFFERINGS AND OTHER RISKS AND UNCERTAINTIES DESCRIBED IN REPORTS
FILED BY THE COMPANY WITH THE SEC, INCLUDING THE ANNUAL REPORT ON FORM 10-K
FILED FOR THE YEAR ENDED JUNE 30, 2003. YOU ARE CAUTIONED NOT TO PLACE UNDUE
RELIANCE ON ANY FORWARD-LOOKING STATEMENTS, WHICH SPEAK ONLY AS OF THE DATE OF
THIS ANNOUNCEMENT. WE DO NOT UNDERTAKE ANY OBLIGATION TO PUBLICLY UPDATE OR
RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO REFLECT EVENTS OR
CIRCUMSTANCES AFTER THE DATE OF THIS ANNOUNCEMENT OR TO REFLECT THE OCCURRENCE
OF UNANTICIPATED EVENTS, EXCEPT AS REQUIRED BY LAW.
ROSS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three months ended
September 30,
2003 2002
Revenues:
Software product licenses $2,961 $3,733
Consulting and other services 3,556 2,770
Maintenance 5,232 4,923
Total revenues 11,749 11,426
Operating expenses:
Costs of software product licenses 344 346
Costs of consulting and
maintenance 4,999 4,401
Sales and marketing 2,690 2,422
Product development net of
capitalized and amortized computer
software costs 2,125 1,801
General and administrative 1,118 1,361
Provision for uncollectible
accounts 135 272
Total operating expenses 11,411 10,603
Operating earnings (loss) 338 823
Prospective merger transaction
costs 758 -
Other financial, net benefit
(expense) 15 (94)
Earnings before taxes (405) 730
Income tax expense 78 90
Net (loss) earnings (483) 640
Preferred stock dividend (38) (38)
Net (loss) profit available to common
shareholders $(521) $602
Net earnings (loss) per common share
- basic $(0.19) $0.23
Net earnings (loss) per common share
- diluted $(0.19) $0.20
Shares for basic calculation 2,685 2,646
Shares for diluted calculation 2,685 3,267
ROSS SYSTEMS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share related data)
September 30 June 30
2003 2003
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $7,935 $8,628
Accounts receivable, less
allowance for doubtful accounts and
returns 11,716 12,880
Prepaids and other current assets 595 731
Total current assets 20,246 22,239
Property and equipment 1,357 1,406
Computer software costs 13,094 13,573
Other assets 2,993 2,993
Total assets $37,690 $40,211
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of debt $4,511 $2,800
Accounts payable 2,445 2,978
Accrued expenses 4,075 4,940
Income taxes payable 68 261
Deferred revenues 10,105 12,203
Total current liabilities 21,204 23,182
Shareholders' equity:
Common stock 28 28
Preferred Stock 2,000 2,000
Additional paid-in capital 87,311 87,189
Accumulated deficit (69,577) (69,094)
Accumulated comprehensive income
(deficit) (1,931) (1,749)
Treasury Stock (1,345) (1,345)
Total shareholders' equity 16,486 17,029
Total liabilities and
shareholders' equity $37,690 $40,211
DATASOURCE: Ross Systems, Inc.
CONTACT: Robert B. Webster of Ross Systems, Inc., +1-770-351-9600, or
Web site: http://www.rossinc.com/