SSA Global Reports Q2 Financials, Acquires Provia Software

Having warned Wall Street two weeks ago that its fiscal second quarter was a bit bumpier than expected, ERP software supplier SSA Global put the numbers up on the board for the quarter last week as it announced yet another acquisition.

For the quarter, sales were $187.9 million, up 6 percent compared to $178 million in the second fiscal quarter ended January 31 last year. Software licensing sales was $56.8 million, which was up 11 percent compared to the same quarter in fiscal 2005 and increasing the share of licenses as a share of total sales to 30 percent, up 1 percent. (Increasing that percentage is a very tough thing to do for any software vendor, and it is also a very good thing to do.) Taking out the Epiphany acquisition, which closed in September 2005, and counting up the money in the local currencies of the regions where SSA Global does business, license sales were up only 7 percent. Epiphany contributed $4.3 million in license sales and $11.1 million in services and support sales, for a total of $15.4 million in sales. During the fiscal second quarter, SSA Global’s services revenues were $40.2 million, essentially flat, and support revenues were $90.9 million, up 5 percent. Net income was $6.6 million, or 9 cents a share, compared to a loss of $35.6 million, or $7.44 per share, a year ago. While SSA Global may not have done as well as its initial guidance for the quarter, the company has clearly vastly improved in a year’s time.

And hence, the company is on the acquisition trail again. SSA Global has acquired Provia Software, a maker of software to manage various aspects of the supply chain, including order, warehouse, shipping, yard, transportation, and parcel shipping management. The company’s ViaWare software also has RFID support, which makes it a modern tool and one that is increasingly interesting to manufacturers and distributors who are adopting RFID to simplify and better automate their supply chain operations.

Provia is itself the result of the merger in 1999 of a German software developer formerly known as Haushahn and two other software stacks, Logistics Concepts (the third party logistics modules) and Pinnacle Distribution’s Freightlogic transportation management software. Provia is formerly a division of Viastore Systems, a maker of automated storage retrieval systems where software is but a component of the whole complex setup. Exactly how Provia’s software, which runs on Windows, Unix, and Linux boxes, will be integrated into the SSA offerings is not yet clear. Financial terms of the acquisition were not disclosed.