SSA Global Reports Second Quarter 2005 Results
Announcement posted by SSA Global 19 Mar 2005
SSA Global, a leading provider of extended enterprise solutions and services, has announced financial results for the second quarter ended January 31, 2005.
Total revenue for the second quarter rose to $178.0 million, an increase of 14 percent from $156.0 million in the second quarter of last year. Software license revenue was $51.0 million, up 35 percent from the second quarter last year. Software license revenue represented 29 percent of total revenue for the quarter ended January 31, 2005 compared to 24 percent for the second quarter last year.
Earnings before interest expense, income taxes, depreciation and amortisation (EBITDA) for the second quarter was $32.0 million, an increase of 2 percent, compared to $31.4 million in the prior year quarter. The growth percentage in EBITDA was lower than total revenue growth during the second quarter largely as a result of investments in market initiatives to meet the companys intermediate and long-term business objectives. Net income for the second quarter 2005 was $8.0 million this year compared to $8.3 million for the second quarter last year.
During the second quarter, North America contributed 42 percent of total revenue, while Europe, Middle East and Africa (EMEA) contributed 41 percent and Asia-Pacific/Japan and Latin America contributed the remaining 17 percent of total revenue. In the quarter ended January 31, 2005, 660 software license contracts were signed, including 66 new customers purchasing extended enterprise resource planning solutions.
As demonstrated in our 2005 second quarter results, we have continued to execute on our corporate strategy to acquire market share and develop customer share while making key investments in SSA Globals future, said Mike Greenough, chairman, president and CEO of SSA Global. Our growth in software license revenue, both organically and via earlier acquisition activity, continues to provide evidence of our customers commitment to SSA Global, added Greenough.
About SSA Global
SSA Global is a leading provider of extended enterprise resource planning (ERP) solutions for manufacturing, distribution, retail, services, and public organisations worldwide. In Australia and New Zealand, SSA Global is number one in the manufacturing market. In addition to core ERP applications, SSA Global offers a full range of integrated extended solutions including corporate performance management, customer relationship management, product lifecycle management, supply chain management and supplier relationship management. Headquartered globally in Chicago, and for the APJ region in Sydney, SSA Global has 63 locations and its product offerings are used by approximately 13,000 active customers in over 90 countries. For additional information, visit the SSA Global web site at www.ssaglobal.com/pacific.
SSA Global is the new corporate brand for product lines and subsidiaries of SSA Global Technologies, Inc. SSA Global, SSA Global Technologies and SSA GT are trademarks of SSA Global Technologies, Inc. Other products mentioned in this document are registered, trademarked or service marked by their respective owners.
Presentation of Non-GAAP Financial Measures
The non-GAAP financial measure presented in the text of this press release, EBITDA, is intended to provide a useful supplement to cash flow from operations in understanding cash flows generated from operations that are available for debt service (interest and principal payments) and further investment in research and development and acquisitions. We believe EBITDA provides meaningful additional information that enables management to monitor our ability to generate cash and provides investors an understanding of cash flow performance over comparative periods. We also believe EBITDA reflects the underlying economics of our business and aligns with the operating cash flow performance of our company as measured under GAAP. However, EBITDA is not a measure of cash flow performance under GAAP and should not be considered in isolation or as a substitute for cash flows from operations, or other cash flow statement data prepared in accordance with GAAP, as a measure of liquidity or as indicative of whether cash flows will be sufficient to fund our future cash requirements. Moreover, EBITDA is not a standardized measure and may be calculated in a number of ways. Accordingly, the EBITDA information provided in this press release might not be comparable to other similarly titled measures provided by other companies.
Forward-Looking Statements
These materials may contain "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any statements that are not statements of historical fact (including without limitation statements to the effect that SSA Global or its management "believes," "expects," "anticipates," "plans," "looks forward" and similar expressions) should be considered forward-looking statements. Any "forward-looking statements" in these materials are subject to certain risks and uncertainties that could cause actual results to differ materially from those stated. Many important factors could cause SSA Global's actual results to differ materially from those expressed in the forward-looking statements made by or on behalf of SSA Global, including, without limitation, the size and timing of license transactions, the effect of economic conditions on the spending patterns of SSA Globals customers, the impact of competitive products and services, the effect of fluctuations in the economy and local currency, the ability of SSA Global to accurately forecast revenue, the ability to maintain adequate cash flow, the ability to maintain a satisfactory credit facility, the relationship between SSA Global and its affiliates and suppliers, the ability to manage costs and expenses, the availability of qualified resources, the ability to develop and enhance products, and other unknown risks including those as may be detailed in other SSA Global filings, reports and releases. SSA Global undertakes no obligation to revise or publicly update these forward-looking statements, whether as a result of new information or otherwise.
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Total revenue for the second quarter rose to $178.0 million, an increase of 14 percent from $156.0 million in the second quarter of last year. Software license revenue was $51.0 million, up 35 percent from the second quarter last year. Software license revenue represented 29 percent of total revenue for the quarter ended January 31, 2005 compared to 24 percent for the second quarter last year.
Earnings before interest expense, income taxes, depreciation and amortisation (EBITDA) for the second quarter was $32.0 million, an increase of 2 percent, compared to $31.4 million in the prior year quarter. The growth percentage in EBITDA was lower than total revenue growth during the second quarter largely as a result of investments in market initiatives to meet the companys intermediate and long-term business objectives. Net income for the second quarter 2005 was $8.0 million this year compared to $8.3 million for the second quarter last year.
During the second quarter, North America contributed 42 percent of total revenue, while Europe, Middle East and Africa (EMEA) contributed 41 percent and Asia-Pacific/Japan and Latin America contributed the remaining 17 percent of total revenue. In the quarter ended January 31, 2005, 660 software license contracts were signed, including 66 new customers purchasing extended enterprise resource planning solutions.
As demonstrated in our 2005 second quarter results, we have continued to execute on our corporate strategy to acquire market share and develop customer share while making key investments in SSA Globals future, said Mike Greenough, chairman, president and CEO of SSA Global. Our growth in software license revenue, both organically and via earlier acquisition activity, continues to provide evidence of our customers commitment to SSA Global, added Greenough.
About SSA Global
SSA Global is a leading provider of extended enterprise resource planning (ERP) solutions for manufacturing, distribution, retail, services, and public organisations worldwide. In Australia and New Zealand, SSA Global is number one in the manufacturing market. In addition to core ERP applications, SSA Global offers a full range of integrated extended solutions including corporate performance management, customer relationship management, product lifecycle management, supply chain management and supplier relationship management. Headquartered globally in Chicago, and for the APJ region in Sydney, SSA Global has 63 locations and its product offerings are used by approximately 13,000 active customers in over 90 countries. For additional information, visit the SSA Global web site at www.ssaglobal.com/pacific.
SSA Global is the new corporate brand for product lines and subsidiaries of SSA Global Technologies, Inc. SSA Global, SSA Global Technologies and SSA GT are trademarks of SSA Global Technologies, Inc. Other products mentioned in this document are registered, trademarked or service marked by their respective owners.
Presentation of Non-GAAP Financial Measures
The non-GAAP financial measure presented in the text of this press release, EBITDA, is intended to provide a useful supplement to cash flow from operations in understanding cash flows generated from operations that are available for debt service (interest and principal payments) and further investment in research and development and acquisitions. We believe EBITDA provides meaningful additional information that enables management to monitor our ability to generate cash and provides investors an understanding of cash flow performance over comparative periods. We also believe EBITDA reflects the underlying economics of our business and aligns with the operating cash flow performance of our company as measured under GAAP. However, EBITDA is not a measure of cash flow performance under GAAP and should not be considered in isolation or as a substitute for cash flows from operations, or other cash flow statement data prepared in accordance with GAAP, as a measure of liquidity or as indicative of whether cash flows will be sufficient to fund our future cash requirements. Moreover, EBITDA is not a standardized measure and may be calculated in a number of ways. Accordingly, the EBITDA information provided in this press release might not be comparable to other similarly titled measures provided by other companies.
Forward-Looking Statements
These materials may contain "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Any statements that are not statements of historical fact (including without limitation statements to the effect that SSA Global or its management "believes," "expects," "anticipates," "plans," "looks forward" and similar expressions) should be considered forward-looking statements. Any "forward-looking statements" in these materials are subject to certain risks and uncertainties that could cause actual results to differ materially from those stated. Many important factors could cause SSA Global's actual results to differ materially from those expressed in the forward-looking statements made by or on behalf of SSA Global, including, without limitation, the size and timing of license transactions, the effect of economic conditions on the spending patterns of SSA Globals customers, the impact of competitive products and services, the effect of fluctuations in the economy and local currency, the ability of SSA Global to accurately forecast revenue, the ability to maintain adequate cash flow, the ability to maintain a satisfactory credit facility, the relationship between SSA Global and its affiliates and suppliers, the ability to manage costs and expenses, the availability of qualified resources, the ability to develop and enhance products, and other unknown risks including those as may be detailed in other SSA Global filings, reports and releases. SSA Global undertakes no obligation to revise or publicly update these forward-looking statements, whether as a result of new information or otherwise.
For press inquiries, please contact: