Idea to Action Initiative Expands E-Business Offering and Sets Foundation for Business Beyond Year 2000
J.D. Edwards today reported financial results for the third quarter ended July 31, 1999. Revenue for the third quarter of fiscal 1999 was $232.1 million, compared to revenue of $239.6 million in the third quarter of fiscal 1998. The net loss for the quarter, excluding one-time charges and amortisation of intangible assets associated with the acquisitions of Numetrix Limited and The Premisys Corporation, was $7.2 million, or $0.07 per diluted share. Net income for the third quarter of fiscal 1998 was $18.1 million, or $0.16 per diluted share. License fee revenue was $75.0 million, compared to license fee revenue of $98.1 million in the third quarter of fiscal 1998. Services revenue rose 11% over the same period last year, to $157.1 million.
For the nine months ended July 31, 1999, revenue reached $686.6 million, an increase of 10% over revenue of $626.8 million for the same period in fiscal 1998. The net loss for the nine months ended July 31, 1999, excluding acquisition costs, was $11.7 million, or $0.11 per diluted share, compared to net income of $36.8 million, or $0.34 per diluted share, for the nine months ended July 31, 1998.
Including acquisition costs, the net loss was $33.2 million, or $0.31 per diluted share for the quarter ended July 31, 1999, and $39.4 million, or $0.38 per diluted share for the nine months ended July 31, 1999.
J.D. Edwards also announced today that its Board of Directors has authorised the repurchase of up to eight million shares of the Company's common stock under its share repurchase plan. The plan is designed to partially offset the effects of share issuances under J.D. Edwards' stock option and employee stock purchase plans. The number of shares to be purchased and the timing of purchases will be based on several factors, including the level of stock issuances under the stock plans, the price of J.D. Edwards' stock, general market conditions and other factors. Stock repurchases may be effected from time to time at management's discretion through forward, put and call transactions, or open market purchases.
Compared to the prior quarter, license fee revenue grew 12% in the third quarter of fiscal 1999. The Company also reduced costs and expenses in the third quarter compared to the prior quarter. The reduction in costs and expenses was a result of the Company's ongoing efforts to control costs during a challenging period in its marketplace. J.D. Edwards has recently announced several key E-business initiatives and alliances that provide a complete, flexible enterprise application solution to help customers achieve rapid return on investment while putting their ideas into action. These initiatives include:
* Completion of Numetrix Limited acquisition. J.D. Edwards acquired the stock of Numetrix, a Toronto-based provider of Internet-enabled supply chain management software, for approximately $80 million cash in a purchase accounting transaction. The Numetrix solution, in combination with J.D. Edwards applications, delivers the only Web-based end-to-end collaborative supply chain solution. The solution accelerates the flow of goods and services through the extended enterprise, reducing manufacturing cycle time and investment in working capital, and increasing responsiveness to customer demands. As recently announced, Herlitz AG of Germany has already realised a significant return on investment from this Internet collaboration solution by reducing the required time, labour and inventory to process and deliver orders.
* Integration of J.D Edwards' Numetrix/xtr@ Solution with IBM's Application Framework for E-business. J.D. Edwards teamed with IBM (r) (NYSE: IBM) to offer joint customers the tools they need to optimise their total supply/demand networks, further extending the power of E-business with advanced messaging and optimisation facilitating real-time collaboration between organisations both inside and outside the enterprise.
* Announcement of Supply Chain Advantage. J.D. Edwards teamed with IBM and supply chain software provider SynQuest to provide Supply Chain Advantage, a unique supply chain E-business solution for the industrial fabrication and assembly industries including fabricated metals, commercial machinery and equipment and furniture manufacturers. Supply Chain Advantage delivers a fully-integrated, end-to-end supply chain solution through a bundle of hardware, software and services including an E-business solution powered by IBM RS/6000(r), AS/400(r) or Netfinity(r) brand servers. The solution provides significant, rapid return on investment by reducing the typical evaluation, selection and implementation time period, while supporting continuous business process improvement with J.D. Edwards ActivEra(tm). Irwin Seating Company, a new customer in the quarter, is taking advantage of this solution.
* Alliance with Siebel Systems, Inc. (Nasdaq: SEBL). In the third quarter, J.D. Edwards formed a strategic sales and product alliance with Siebel Systems, Inc. to deliver Web-based customer relationship management and E-business solutions. The Company has made significant progress with the integration process and closed its first sale of Siebel products in the third quarter.
* Alliance with Ariba, Inc. (Nasdaq: ARBA). J.D. Edwards entered into a strategic alliance with Ariba, Inc. to resell Ariba(r) business-to-business electronic commerce solutions. The alliance extends J.D. Edwards' procurement offering and provides customers with solutions to improve the efficiency and reduce the cost of acquiring and managing operating resources. J.D. Edwards is currently integrating OneWorld(tm) with a specifically-engineered version of the Ariba Operating Resource Management System(tm) (Ariba ORMS(tm)) and with the Ariba.com Network(tm).
J.D. Edwards has continued to develop strategic partnerships and alliances with industry leading companies to provide its customers flexibility in choosing the most appropriate software applications to meet their needs. By partnering with value-add solution providers who deliver high return on investment now, J.D. Edwards extends its reach and offers solutions that provide flexibility and Web-enabled capabilities to meet the demands of today's rapidly changing information economy. J.D. Edwards formed or expanded the following key partnerships and alliances during the quarter:
* Deloitte & Touche Outsourcing Services Alliance. J.D. Edwards and Deloitte & Touche formed an agreement under which Deloitte & Touche will provide business process outsourcing services to clients nationwide using J.D. Edwards software. Under the new agreement, Deloitte & Touche's national business process outsourcing practice, CORe, provides business process design and reengineering, enterprise business software integration and implementation, and back-office accounting and financial operations to companies in all industries, using J.D. Edwards software solutions.
* Expansion of Grant Thornton Alliance Agreement. Grant Thornton expanded its consulting alliance agreement with J.D. Edwards to provide enterprise software consulting and implementation services to fast-growth customers nationwide with a focus on mutual vertical target markets. Some of these markets include, retail and wholesale distribution, discrete and process manufacturing, and services organisations. Grant Thornton will team with J.D. Edwards to provide resources and expertise in a variety of product services, including E-business, supply chain management and customer relationship management.
* Alliance with Cisco Systems. J.D. Edwards and Cisco Systems (Nasdaq: CSCO), announced an alliance to provide high-powered, end-to-end E-Business solutions to midsized, growth companies. Through the Cisco Resource Network for Midsized Businesses, the combination of J.D. Edwards enterprise applications and the Cisco network infrastructure will provide innovative Internet business solutions that boost performance through electronic business.
* Formation of additional alliances to extend market reach and offer expanded solutions. Other alliances formed during the quarter which strengthen the Company's ability to offer complete solutions to its customers in the areas of E-business, customer relationship management, supply chain management and knowledge management include Atrion International, Armstrong Laing Group, IET-Intelligent Electronics, and XRT-Cerg Finance S.A.
* Corporate appointments support E-business and customer focus. During the quarter J.D. Edwards hired Jack Blount as Vice President of E-business. Blount, a 25 year computer industry veteran, will be responsible for the Company's technology direction, with particular focus on messaging and interoperability. Heading E-business infrastructure development, Blount's charter is to provide strategic E-business product solutions that address the needs of today's transformation to new business models. The Company also established the Office of Customer Advocacy to promote even greater customer awareness and communication and to ensure that customer feedback is turned into meaningful information to shape the Company's strategic direction. Idella Kercher, Vice President of Customer Advocacy, will lead this office.
* Signing of new license agreements. License agreements were signed with customers including ALLTEL Corporation, American Medical Response, Inc., CB Richard Ellis, Inc., Centre of Excellence, L.L.C., Comdial Corporation, Consolidated Papers, Inc., Estee Lauder International, Inc., International Products Corporation, Irwin Seating Company, , Martin Dawes Communications Limited and Service Partners, LLC. The company now has nearly 5,400 customers.
* Numerous customers going live on OneWorld. Nearly 120 customers went live on OneWorld bringing the total number of live OneWorld customers to over 420. Customers that recently went live include Holiday Retirement Corp., Axent Technologies, Cascade Corporation of America, Clarion Corp. of America, Corbis Corporation, Delta Engineering Holdings Limited, DHL International Express Ltd., and Stoneridge, Inc.
About J.D. Edwards
J.D. Edwards provides Idea to Action(tm) software for managing the enterprise and supply chain. The Company's integrated applications give customers control over their front office, manufacturing, logistics/distribution and finance processes for the consumer products, industrial and services industries. J.D. Edwards enables Idea to Action with ActivEra(tm), a collection of tools and technologies that extend the J.D. Edwards SCOREX and AIMX supply chain solutions and OneWorld(tm) and WorldSoftware(tm) enterprise business software. ActivEra allows customers to change their enterprise software quickly and easily during and after implementation. The Company's solutions operate in multiple computing environments, including Windows NT(r), UNIX(r) and OS/400(r), and are Java(tm) and HTML enabled. Founded in 1977, J.D. Edwards is headquartered in Denver and posted fiscal 1998 revenues of $934 million. Additional information can be obtained from J.D. Edwards on 01189091700 or at www.jdedwards.com
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Copyright(c) J.D. Edwards World Source Company, 1999. J.D. Edwards is a registered trademark of J.D. Edwards & Company. The names of all other products and services of J.D. Edwards used herein are trademarks or registered trademarks of J.D. Edwards World Source Company. All other product names used herein are trademarks or registered trademarks of their respective owners. The historical results stated above are not necessarily indicative of the results of any future period. source c
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