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 REDWOOD CITY, Calif., Aug. 20 /PRNewswire/ -- Ross Systems, Inc. (NASDAQ: ROSS) today announced record revenues and earnings for the fourth quarter ended June 30.
 Revenues increased 13 percent for the quarter to $25.7 million compared to $22.8 million in a very strong quarter for the same period last year. Net earnings for the quarter rose 28 percent to $2.6 million from $2.1 million in the prior year, while earnings per share for the period increased to $0.26 from $0.20 in the prior year.
 Revenues for the year ended June 30 increased 15 percent to $87.1 million from $75.5 million in the prior year. A net loss of $1.1 million, or $0.12 per share, for the year compares with earnings of $4.0 million, or $0.40 per share, in the previous year. The results for fiscal 1993 include a $6.4 million pre-tax charge accrued in the first quarter of fiscal 1993 related to prior acquisitions.
 "Though the company reported a loss for the year as a result of expensing certain acquisition costs in the first quarter, we are very pleased with the results for our last three quarters," said Dennis Vohs, chairman and CEO, Ross Systems. "During this nine month period, earnings increased 38 percent over the same period last year. For the last three quarters, revenues increased 18 percent over the same period in fiscal 1992, despite the negative impact of currency rate changes in Europe."
 Revenues from the client/server product offerings, including Renaissance CS(TM) Financial Series and Human Resource CS(TM) Series, increased significantly. In the fourth quarter, revenues from these products represented 43 percent of total software license fees and 28 percent of total revenues. The company has capitalized on the considerable growth opportunities in the client/server marketplace as customers continue to downsize mainframe applications. Significant investments in product development and marketing over a two-year period have allowed Ross Systems to be positioned as a leading supplier of client/server solutions.
 "More than half of our fiscal 1993 revenues were generated from customers in the manufacturing sector. Our PROMIX(TM) process manufacturing system was a key component in many of these sales. PROMIX revenues increased to $5.0 million for the quarter and $18.0 million for the year. These revenues represent 21 percent of total fiscal 1993 revenues and an increase of 54 percent over last year. Release 3.0 of PROMIX is in beta test sites today and will further strengthen our competitiveness in this market when it becomes generally available," Vohs said.
 During the year, the company restructured its North American Sales organization to upgrade its quality and increase the experience of its sales staff. In addition, extensive training was conducted in client/server computing and enterprise-wide selling. As a result of these actions and the improving U.S. economy, North American revenues grew by 27 percent in the year. In addition, major investments were made in training the company's field consultants on both client/server technology and a major new release of PROMIX. These favorable trends in North America more than offset lower than expected European growth rates.
 As of year-end, the company's cash balances totaled $10.3 million, up $2.2 million from the previous quarter and $2.6 million from the previous year. Accounts Receivable days sales outstanding declined to 122 days from 136 days last year. The effective tax rate in the fourth quarter was 20 percent, down from 35 percent in the same quarter last year. This significantly lower effective tax rate is principally the result of lower international tax rates and the recovery of certain foreign tax amounts previously provided. The company expects future effective tax rates in the 38 percent to 42 percent range.
 "As a result of our investments in product development and training, strong market acceptance of our new client/server products, and consistent contributions from our installed base, we are optimistic about the outlook for fiscal 1994," Vohs concluded.
 Today, Ross Systems develops and markets a broad range of business solutions in seven strategic environments: Digital's Alpha AXP architecture, Open VMS, and OSF/1; Hewlett-Packard's HP-UX and MPE/iX; UNIX; and client/server. Ross products encompass financial, human resources and distribution systems, as well as manufacturing and public sector applications, complemented by a fourth generation application development language. The company has been following a corporate development strategy of broadening its product line and expanding through both internal growth and acquisitions. Ross Systems serves its customers through a network of 38 offices worldwide. The company is headquartered at 555 Twin Dolphin Drive, Redwood City, CA 94065; telephone, 415-593-2500.
 NOTE: All product names referenced herein are trademarks of their respective companies.
 Consolidated Statements of Operations
 (In thousands, except per share data)
 3 mos. ended 12 mos. ended
 6/30/93 6/30/92(a) 6/30/93 6/30/92(a)
 Software product licenses $ 11,950 $ 11,859 $ 36,162 $ 35,303
 Consulting and other
 services 7,528 6,362 28,991 22,777
 Maintenance 6,168 4,553 21,949 17,390
 Total 25,646 22,774 87,102 75,470
 Operating expenses:
 Cost of revenues 8,839 6,764 33,048 24,999
 Sales and marketing 7,184 7,973 28,476 26,087
 Product development 3,463 2,370 11,334 9,107
 General and administrative 2,537 2,363 9,490 7,859
 Charges for in-process
 research and development --- --- 4,091 ---
 Amortization of other assets 292 213 1,165 967
 Total 22,315 19,683 87,604 69,019
 Operating earnings (loss) 3,331 3,091 (502) 6,451
 Interest income (expense),
 net (41) 84 (98) 195
 Earnings (loss) before
 income taxes 3,290 3,175 (600) 6,646
 Income tax expense 659 1,114 524 2,624
 Net earnings (loss) $ 2,631 $ 2,061 $ (1,124) $ 4,022
 Net earnings (loss) per
 common and common
 equivalent share $ .26 $ .20 $ (.12) $ .40
 Common and common equivalent
 shares used in computing
 earnings (loss) per common
 share 10,316 10,055 9,733 10,126
 (a) As restated for change in revenue recognition
 Consolidated Balance Sheets
 (In thousands)
 6/30/93 6/30/92(a)(b)
 Current assets:
 Cash and cash equivalents $ 10,298 $ 7,741
 Accounts receivable, net 29,595 28,428
 Prepaids and other current assets 2,237 1,722
 Deferred income taxes 8,352 3,277
 Total current assets 50,482 41,168
 Property and equipment 5,876 5,991
 Computer software costs 10,192 6,521
 Other assets 4,068 4,357
 Total $ 70,618 $ 58,037
 Liabilities and Shareholders' Equity
 Current liabilities:
 Current installments of debt $ 480 $ 250
 Accounts payable 5,148 4,210
 Accrued expenses 9,456 7,279
 Income taxes payable 2,468 1,328
 Deferred revenue 11,556 10,027
 Total current liabilities 29,108 23,094
 Long-term debt, less current
 installments 6,662 1,128
 Deferred income taxes 5,059 2,886
 Total liabilities 40,829 27,108
 Shareholders' equity:
 Common stock 41,881 40,640
 Accumulated deficit (11,278) (10,154)
 Cumulative translation
 adjustment (814) 443
 Total shareholders' equity 29,789 30,929
 Total $ 70,618 $ 58,037
 (a) As restated for change in revenue recognition
 (b) Certain amounts have been reclassified to conform to current year's presentation.
 -0- 8/20/93
 /CONTACT: Dennis Vohs or Cecilia Roach of Ross Systems, 404-851-1872/

CO: Ross Systems, Inc. ST: California IN: CPR SU: ERN

BR-CM -- AT002 -- 4607 08/20/93 08:33 EDT
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Publication:PR Newswire
Date:Aug 20, 1993

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