American Software Reports Fourth Quarter Results / Continues

American Software, Inc. (Nasdaq: AMSWA) today reported financial results for the fourth quarter and fiscal year ended April 30, 1999. Fourth quarter results represent a continued improvement of increased revenues and profitability and exceeded analysts' revenue and earnings estimates. For the fourth quarter ended April 30, 1999, net income was $4.9 million or $.22 per diluted share which includes $3.7 million or $.17 per diluted share of non-recurring benefits. This compares to net income of $1.0 million or $.05 per share for the proceeding quarter and net income of $2.6 million or $.11 per diluted share for the comparable period last year. Software license fees for the quarter were $6.0 million, a 6% improvement over the third quarter. Services revenues contributed $16.6 million, a 5% increase from the third quarter. Maintenance revenues were $6.2 million, a 6% decrease over the third quarter. Total revenues for the quarter were $28.8 million, a 3% improvement over the preceding quarter. For the year ended April 30, 1999, total revenues were $109.2 million, a 2% increase over the comparable period last year. For the year ended April 30, 1999, the Company incurred a net loss of $8.5 million or $.38 per diluted share excluding nonrecurring items. This compares to net income of $7.8 million or $.32 per diluted share for the prior year. "American Software continues to show revenue and profitability improvement as a result of actions taken earlier in this fiscal year in response to the overall enterprise application market slowdown. We are especially excited by the improvement in license fees in the second half of our fiscal '99 year and the increasing recognition of American Software's competitive and highly flexible Intelliprise(TM) and Flow Manufacturing(R) product offerings," stated James C. Edenfield, president and CEO of American Software. James C. Edenfield continued, "As we begin Fiscal Year 2000, we see positive trends in the sales activities within most of our businesses. Most notably, Logility closed the largest sale in its history in May. This deal of over $3.0 million in license revenues is with one of the largest food companies in the world and gives the combined Company an excellent start to Fiscal Year 2000. Additionally, our e-business strategies continue to grow with increasing sales by our majority owned subsidiary Intellimedia Commerce, our expanded ECON product suite and our network hosting business, AmQUEST. The overall financial condition of the Company remains very strong with cash and investments of approximately $49.0 million and long-term debt of less than $1 million. Cash and Investments, including the Company's portion of Logility's cash, is $44.9 million or approximately $2.04 per diluted share. The Company continued its share buyback plan under which the Board of Directors has authorized the purchase of up to 2.7 million shares in open market transactions. During the quarter, approximately 283,500 shares were purchased at an average price of $3.29, bringing the total shares purchased under the plan to nearly 1.3 million shares. Business Highlights Include: Logility

* The Company's 84% owned subsidiary, Logility (Nasdaq: LGTY), the leading supplier of collaborative value chain planning solutions via the Internet, added some notable new customers including, CONDEA Vista Company, Wickes Furniture, Tyco Plastics and Adhesives, US Ceramic Tile Company and Thomaston Mills, Inc. In addition, existing customers including British Telecommunications, Mercury Marine and ConAgra, Inc. placed additional orders for Logility products.

* Voyager XPS(TM) launched as a new addition to the product suite, Logility Value Chain Solutions(TM). Voyager XPS is an Internet-based value chain management application that allows the user to implement a business process for collaborative planning, forecasting and replenishment (CPFR) that crosses traditional boundaries with trading partners.

* The selection of WarehousePRO, part of the Logility Value Chain Solutions suite, as Product of the Year by readers of Managing Automation Magazine.

* Logility extended its international partner program with two new partners, Burns Bridge Nagel Pty Ltd. in Australia and Eberle Systems in Germany, for implementation and/or sales of Logility Value Chain Solutions. Burns Bridge Nagel Pty Ltd. is the Logistics and Supply Chain Management division of Burns Bridge, a consulting group providing Business Infrastructure Solutions to its clients. Eberle Systems is a leading supplier of simulation software to some of the largest German industrial companies.


* The Company's majority owned subsidiary, Intellimedia Commerce, provider of technology-based services for four primary phases of the e-business cycle: customer acquisition, transaction execution, customer retention, and customer service, announced a new venture, Intellimedia Security, that is developing a new online service, Rivaling traditional safe- deposit boxes, will provide the protection of valuable and confidential electronic documents and files using secure online storage. NetB@nk, (Nasdaq: NTBK) the largest FDIC- insured bank operating solely on the Internet, is providing funding and distribution as a launch partner of the site.

* Expanded the Company's internet-based applications-ECON (Electronic Commerce Over the Net) product family with the introductions of ECON/Expenses(TM) and ECON/Order(TM). ECON/Expense is an Internet- based solution that enables companies to significantly reduce administrative costs associated with travel & entertainment (T&E), that are typically the third largest corporate expense item. ECON/Order enables companies to leverage the Internet to allow customers, dealers, distributors and a remote sales force to securely enter and track orders, helping companies increase service, reduce inventories and make more informed business decisions.

* PNC Bank, one of the nation's largest financial services companies, began piloting a program to streamline its purchasing process using ECON/Catalog(TM) for Internet-based procurement to consolidate orders, eliminate maverick buying, control costs and better manage suppliers.

* The Company's AmQUEST subsidiary, which provides e- business services, continues to show significant revenue growth by providing hosting services for notable customers like Komatsu America, WestPoint Stevens, University Hospital, Oce Printing Systems US, Inc., Saftey-Kleen, Snap- on, Inc., and VWR Scientific Products.

Enterprise Solutions

* Mayville Metals, a manufacturer of sheet metal enclosures for the high tech and telecommunications industries, became a new customer licensing the full Intelliprise product suite to manage and optimize its customer focused flow manufacturing operations at three plants.

* Extended Intelliprise Business Intelligence offering with the addition of an Inventory Performance data mart. Inventory Performance, along with the Channel Performance data mart also delivered during the '99 fiscal year, provides a dashboard-like graphical interface that visually indicates the current performance of the company. Intelliprise incorporates out-of-the- box key performance indicators following the guidelines of Generally Accepted Accounting Principles (GAAP) and the Supply Chain Reference Model (SCOR) to provide comprehensive financial and operational views for quick business insight.

* Whittman-Hart, a leading provider of information technology (IT) consulting and integration services for middle market and growing companies, was named a preferred provider for Intelliprise implementation services.

* A number of notable customers, including SC Johnson Polymer, Norton Chemical, and US Ceramic Tile, went "live" during the year and are now managing their enterprises with the Intelliprise product suite.

* New Generation Computing, the Company's recent acquisition and a leader in the apparel software industry, has significantly exceeded forecasted revenue and earnings targets for the nine months ended April 30, 1999. Customers include William Carter, HartMarx, HugoBoss, Unifirst and Maidenform. The Company added to its management strength by elevating James M. Modak to the position of Senior Vice President and Chief Financial Officer. Mr. Modak, who has been serving as the Chief Financial Officer of Logility Inc., the Company's 84% owned subsidiary will continue to serve in that capacity as well.

Headquartered in Atlanta, American Software develops, markets and supports the industry's most comprehensive offering of integrated business applications, including enterprise-wide, supply chain management, financial and manufacturing packages. Intelliprise(TM) is a total ERP/supply chain management suite, which leverages Internet connectivity and includes multiple manufacturing methodologies, flexible international organizations and integrated data marts. The Company's Flow Manufacturing(R) solution is the first dedicated application for automating demand-based manufacturing operations as a best-of-class client/server extension to existing ERP systems. Additionally, American Software holds 84% ownership in Logility Inc., the leading supplier of collaborative value chain planning solutions via the Internet.

Forward-Looking Statements

This press release contains forward-looking statements, which 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. Such factors include, but are not limited to, changes in general economic conditions, technology and other changes in the market for the Company's products and services, the timely availability and market acceptance of these products and services, the effect of competitive products and pricing, and the irregular pattern of the Company's revenues as well as a number of other factors which could effect the future performance of the Company. For further information, please refer to the Company's Form 10-K for the year ended April 30, 1998 and other reports and documents subsequently filed with the Securities and Exchange Commission.

For more information, contact: American Software, 470 East Paces Ferry Rd., Atlanta, GA 30305 (800) 726-2946. (404) 261- 4381. FAX: (404) 264-5206 INTERNET: or E- mail: Flow Manufacturing is a registered trademark and Intelliprise, ECON/Order, ECON/Expense and ECON/Catalog are trademarks of American Software, Inc. is a registered trademark of Intellimedia Commerce, Inc. Voyager XPS is a registered trademark of Logility, Inc.


Sequential Quarterly Performance

(In thousands except per share data)


Quarter Ended

April 30, January 31, Pct

1999 1999 Chg.


License $6,009 $5,650 6%

Services 16,556 15,757 5%

Maintenance 6,185 6,598 (6%)

Total Revenues 28,750 28,005 3%

Cost of Revenues:

License 1,035 863 20%

Services 12,120 11,630 4%

Maintenance 2,705 2,583 5%

Total Cost of Revenues 15,860 15,076 5%

Gross Margin 12,890 12,929 0%

Operating expenses:

Research and development 5,342 5,140 4%

Less: capitalized development (2,613) (2,768) (6%)

Sales and marketing 5,950 6,618 (10%)

General and administrative 3,764 3,525 7%

Credit for impaired

asset adjustment (1,442) --- nm

Total operating expenses 11,001 12,515 (12%)

Operating income 1,889 414 nm

Other income 822 926 (11%)

Minority interest 45 (154) nm

Income before taxes 2,756 1,186 nm

Income taxes expense/

(benefit) (2,138) 173 nm

Net Income after

non-recurring credits $4,894 $1,013 nm

Net Income before

non-recurring credits $1,165 $1,013 nm

Net income per common share

after non-recurring

credits - Diluted $0.22 $0.05 nm

Net income per common share

before non-recurring

credits - Diluted $0.05 $0.05 nm

Weighted average

common shares - Diluted 21,991 22,019 nm - not meaningful


Statements of Operations

(In thousands except per share data)


Fourth Quarter Ended Year Ended

April 30, April 30,

Pct Pct

1999 1998 Chg. 1999 1998 Chg.


License $6,009 $ 8,790 (32%) $19,602 $33,548 (42%)

Services 16,556 14,927 11% 63,572 50,090 27%

Maintenance 6,185 6,223 (1%) 26,003 23,834 9%

Total Revenues 28,750 29,940 (4%) 109,177 107,472 2%

Cost of Revenues:

License 1,035 2,117 (51%) 8,254 8,182 1%

Services 12,120 9,348 30% 45,343 33,439 36%

Maintenance 2,705 1,765 53% 10,338 7,642 35%

Total Cost

of Revenues 15,860 13,230 20% 63,935 49,263 30%

Gross Margin 12,890 16,710 (23%) 45,242 58,209 (22%)

Operating expenses:

Research and

development 5,342 5,498 (3%) 22,413 20,939 7%

Less: capitalized

development (2,613) (2,364) 11% (10,902) (8,827 24%

Sales and

marketing 5,950 7,312 (19%) 28,859 25,915 11%

General and

administrative 3,764 3,129 20% 16,307 11,530 41%

Charge for write-off

of software development

costs ($24.2 million),

In-Process R&D

($1.8 million),

impaired asset

($0.4 million) &


($0.2 million) (1,442) --- nm 26,563 -- - nm

Total operating

expenses 11,001 13,575 (86%) 83,240 49,557 nm

Operating income

(loss) 1,889 3,135 (74%) (37,998) 8,652 nm

Other income 822 1,584 nm 2,020 4,279 nm

Minority interest 45 (206) nm 1,396 (488)nm

Income (loss)

before taxes 2,756 4,513 nm (34,582) 12,443 nm

Income taxes expense/

(benefit) (2,138) 1,939 nm (1,765) 4,648 nm

Net Income (loss)

after non-recurring

charge/(credit) $4,894 $ 2,574 nm $(32,817) $7,795 nm

Net Income (loss)

before non-recurring

charge/(credit) $1,165 $ 2,574 nm $(8,541) $7,795 nm

Net income per common

share after


credits - Diluted $0.22 $0.11 nm $(1.47) $0.32 nm

Net income per common

share before


credits - Diluted $0.05 $0.11 nm $(0.38) $0.32 nm

Weighted average common

shares - Diluted 21,991 24,153 22,320 24,415

nm - not meaningful

Capsule Balance Sheet Information

(in thousands)


April 30,


Cash and investments $48,864

Accounts receivable:

Billed 17,534

Unbilled 3,539

Total accounts receivable 21,073

Working capital 43,713

Deferred revenues 16,297

Stockholders' equity 67,198 ots Original Text Service: American Software, Inc. Internet: CONTACT: Vince Klinges, Vice President of Finance of American Software, Inc., 404-264-5477/ Web site: /

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