Event
Summary
According to its press release on June 19, American Software announced
that e-intelliprise, its fully web-based ERP solution with complete front-to-back
office integration, now includes a customizable Business Intelligence
Portal that provides secured role-based views of key performance indicators
(KPIs). The Portal is a knowledge management system throughout the supply
chain, measuring KPIs versus yearly, monthly, or daily goals and identifying
trends that could affect overall company strategy.
The
Business Intelligence Portal is the second element of American Software's
Enterprise Portal Strategy, following the recently released Trading Portal.
The Business Intelligence Portal is accessed via the Internet, and provides
a proactive management tool to identify and analyze performance variants
spanning the entire supply chain. The Business Intelligence Portal delivers
real-time information to decide the direction of daily company strategy.
"e-intelliprise
leverages the power of the Internet with the ability to proactively deliver
usable information to drive business decisions", said James C. Edenfield,
president and CEO of American Software. "e-intelliprise has been designed
to provide businesses with the information and system flexibility to respond
to the rapidly changing business demands of the e-business marketplace."
Earlier,
on June 12, American Software announced that e-intelliprise has been
implemented with wireless markup language (WML) capability to allow users
the ability to conduct business transactions via any device that supports
wireless technology. Users of e-intelliprise should be able to increase
response time and competitive advantage by instantaneously managing their
business transactions as events happen. With this capability, e-intelliprise
notifies users of key performance indicators (KPIs) via cell phone, two-way
pager, or PDA, from which a decision maker can take action.
This
wireless order-approval capability extends the power of the ERP throughout
the mobile organization, allowing decision makers instant real-time communication
capabilities. When using the e-intelliprise Trading Portal, the alert
system automatically notifies the user when an RFQ has been opened for
a product. Using wireless capability, the user can accept a vendor bid
instantaneously, wherever they are, immediately after a bid is transmitted.
After the bid is accepted, a purchase order is created and tracked through
the back office system using the front-to-back office integration of e-intelliprise.
"By
giving e-intelliprise wireless capability, American Software is delivering
the real-time notification to mobile decision-makers that virtual companies
need to become even more responsive to rapidly changing business conditions,"
said James C. Edenfield, president and CEO of American Software. "This
will enable companies to optimize their operations and increase profitability
by responding more effectively to business opportunities as they occur."
On
June 7, American Software, Inc. reported results for the fourth quarter
and the twelve months ended April 30, 2000. For the twelve months ended
April 30, 2000, total revenues were $105.5 million, a 3% decrease from
last year. Software license fees were $20.6 million, a 5% increase from
the same period last year. Services revenues were $59.7 million, a 6%
decrease from the comparable period in fiscal 1999. Maintenance revenues
were $25.2 million, a 3% decrease from the same period in fiscal 1999.
Net loss was $1.2 million or $.06 per share, compared to last year's net
loss of $8.5 million or $.38 per share excluding charges and tax benefit
credit of $24.3 million or $1.10 per share for the comparable period last
year.
For
the fourth quarter, the total revenues for the quarter were $23.3 million,
a 19% decrease from the same quarter last year. Software license fees
were $2.4 million, a 60% decrease from the same period last year. Services
revenues were $14.6 million, a 12% decrease from the same quarter last
year. Maintenance revenues were $6.3 million, a 2% increase from the same
period in fiscal 1999. Net loss was approximately $2.7 million or $.12
per share compared to a net income of $1.2 million or $.05 per diluted
share for the comparable period last year excluding a tax benefit credit
and other adjustments of $3.7 million or $0.17 per diluted share. The
overall financial condition of the Company remains very strong with cash
and investments of approximately $44.2 million and no debt.
"This
was a transitional year for American Software. While the impact of Y2K
presented challenges, the launch of our new e-business solution suite
gained industry recognition and AmQUEST, our Application Infrastructure
Provider (AIP) business unit, experienced strong sales success", stated
James C. Edenfield, president and CEO of American Software. "In the coming
year, we will continue to leverage these leading solutions to gain market
momentum."
Market
Impact
American Software, the Atlanta-based enterprise software applications
vendor, has been quite busy over the last few years in its quest to assemble
a broad e-business offering for mid-market users. It continues to announce
additional functions that broaden the scope of its e-intelliprise application
suite, which it released in 1999 as a Web-enabled reincarnation of Intelliprise.
American Software introduced Intelliprise in 1998 as a brand new enterprise
resources planning (ERP) suite that can support multiple modes of manufacturing,
in addition to having full supply chain functionality and Internet connectivity.
The
system provides users with three important factors for success in business
today: the information they need in order to take immediate action, the
perspective to plan future actions, and the flexibility to grow as business
conditions change. Apart from its component-based architecture, the system
is equipped with a set of business process templates that are designed
to run a multinational manufacturing and distribution enterprise.
Very
impressive is the Flow Manufacturing suite that can either be integrated
into Intelliprise or used as a stand-alone package and which is currently
leading the market with its functionality. Other features that can be
bolted on to the Intelliprise suite include a set of supply chain planning
and execution applications, from advanced planning & scheduling (APS)
to warehouse and transportation management, which are provided by Logility,
a wholly owned subsidiary of American Software.
Intelliprise
also features a set of predefined data marts based on SCOR and GAAP performance
metrics that help companies organize methods of collecting and analyzing
data on the performance of individual departments. In addition, it contains
a set of key performance indicators that companies can use to establish
benchmarks for measuring their performance.
American
Software has also introduced a series of applications under the banner
ECON-Electronic Commerce on the Net-which allows customers to access and
use the applications within Intelliprise over the Internet (a series of
Web extensions for order placement, purchasing, catalog, bidding and expense
reporting). Recently announced functions also include the expansion of
the relationship with Categoric Software to embed its alert messaging
into the entire e-intelliprise suite.
We
believe American Software will continue to enhance its portal strategy
and Intelliprise's ability to facilitate collaboration between trading
partners in areas such as forecasting and inventory management. We also
believe that the company should more aggressively pursue alliances with
other vendors that can provide sales force automation and customer relationship
management applications to the suite. However, the company still faces
the challenges presented by a dismal mind share and market visibility
as well as a recent sharp revenue decline and poor financial performance
(See Figure 1 & 2).
Figure
1
Figure
2
User
Recommendations
American Software's traditional target market - multi-national manufacturing
and distribution companies with annual revenues between $100 million and
$800 million may benefit from evaluating the company's value proposition.
The e-intelliprise suite has a broad scope of functionality that may satisfy
the needs of most discrete mid-market manufacturers. Given the fact that
e-intelliprise is a new product, written entirely from scratch and with
only a few dozen clients so far, a rigorous reference checking is recommended.
Any
organization evaluating American Software should consider existing functionality
only, and, in the case of final selection, should inquire and negotiate
incorporation of new applications' components now at negotiated license
fees, given its recent increase in new product introductions. Future clients
are also advised to request the company's written commitment to promised
functionality, general availability date, price, length of implementation,
and seamless future upgrades, particularly for recently announced partnered
offerings. Moderate caution should be exercised now and a watchful eye
should be kept on the company's future financial performance.