JDA’s Sales and Profits Boosted By Manugistics, Organic Growth
August 6, 2007 Timothy Prickett Morgan
After having gotten off to what it called a “flying start” in the first quarter, retail application specialist JDA Software has continued its momentum in the second quarter, driven by both organic growth in its JDA products and by the acquisition of supply chain software specialist Manugistics a little more than a year ago. For the second quarter ended June 30, JDA said that sales were up 75 percent to $90.8 million, and that software license sales were up 80 percent to $10.4 million. Manugistics accounted for $40.1 million in total sales and $6.9 million in software license sales in the second quarter. Earnings for the quarter came to $4.8 million, more than four times the level the company set in the year ago quarter; per share earnings came to 14 cents, up by more than a factor of three. “We have been heavily focused on sales execution since the acquisition, and I believe that these efforts are paying off with excellent sales and a solid pipeline of new business opportunities,” explained Hamish Brewer, JDA’s president and chief executive officer. “We are seeing a surge in demand from new customers, which represent 40 percent of our software license sales during the first half of 2007, as compared to 20 percent in the first six months of 2006. While we will continue to nurture and expand business within our existing client base, we are excited by this growth trend and anticipate welcoming even more companies into the JDA user community this year.” JDA inked 71 deals in the quarter, including four that were in excess of $1 million. The company’s Americas region booked $10.8 million in software license sales, more than twice the level it had a year ago. EMEA sales for software came to $5 million, up 56 percent compared to the year ago quarter, and the Asia/Pacific region had more modest growth, with software sales up 33 percent to $2.8 million. JDA exited the quarter with $65.4 million in cash, and paid off $20 million of its debt, leaving a debt load of $106.1 million on the books. JDA’s shares have risen more or less steadily on the Nasdaq market throughout this year, and only dipped in the past two weeks because Wall Street was letting some air out of itself thanks to bad credit in the housing market. Despite all of that, JDA ended last week with a market capitalization of $667 million. Even with its improving financial position, though, it seems unlikely that someone will swoop in and pay the $1 billion or more it might take to acquire JDA. Besides, Thoma Cressey Bravo already owns a piece of the company, thanks to the Manugistics deal. RELATED STORIES JDA Picks Up Midrange Veteran Ferrere Manugistics Acquisition Powers Growth for JDA in the Fourth Quarter JDA Emphasizes VARs to Attack the Retail Sector JDA Elaborates on Supply Chain Strategy, But Questions Remain JDA’s Development Roadmap Features iSeries in Supporting Role Intel Partnership Doesn’t Hurt iSeries Strategy, JDA Software Says JDA Software Buys Supply Chain Specialist Manugistics
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