Lawson Reports Preliminary Q4 Results, Loses CFO, and Buys CAS
July 31, 2006 Dan Burger
Lawson Software, in its first quarterly financial report since finalizing the acquisition of Intentia International, is expected to report a net loss of between $9.3 million and $12.8 million. The company reported late last week that these numbers were “preliminary” and are pending the completion of tabulations of Intentia’s financial figures. Lawson acquired Intentia on April 24, 2006. The information released is also based on unaudited results for the legacy Lawson operations. Lawson’s fiscal fourth quarter and fiscal year ended May 31.
According to a Lawson press release, the company expects consolidated (Lawson and Intentia) revenues between $125 million and $126.6 million for the quarter. Included in that estimation is license revenues of $19 million to $19.5 million. Excluded from the results is the deferred maintenance and service revenue of between $3 million and $3.5 million that was written down under the accounting method used for the Intentia acquisition.
For the entire fiscal year 2006, the company expects total consolidated revenue to hit a mark between $389.6 million and $391.2 million, including license revenues of $70.8 million to $71.3 million.
Lawson cites the compressed time frame between the closing date of the acquisition and Lawson’s fiscal year end, as the reason for the estimated financials. The company anticipates using the Securities and Exchange Commission’s 15-day extension period for filing its audited financial statements.
Excluding the impact of Intentia’s results, Lawson is reporting increased revenues in every category when comparing numbers year-to-year and fourth quarter 2006 to fourth quarter 2005.
Looking at a quarterly comparison, total revenue for the legacy Lawson business was $94.6 million, an increase of 9 percent. License fees were $18.4 million, compared with $17.4 million last year. Maintenance revenues were $47.2 million, compared with $43.9 million last year. Consulting services revenues were $29 million, compared with $25.5 million last year.
On a full-year basis and excluding the impact of the partial quarter of Intentia’s results, Lawson’s revenues totaled $359.2 million, an increase of 7 percent. License fees were $70.2 million, an increase of 22 percent. Maintenance revenues were $180.8 million, an increase of 6 percent. Consulting services revenues were $108.2 million, up 1 percent.
Overseeing the completion of the company’s financial reporting is chief financial officer, Robert Barbieri, who will be leaving the company October 31. Barbieri has served as Lawson’s executive vice president and CFO since August 2000. Although the timing of this move might raise some eyebrows, Barbieri said in a company-prepared statement to the press that he is “fully supportive of the plans for the combined Intentia and Lawson businesses, and I continue to believe in the company and its leadership, people, financial health, and future.” He also left the door open to possibly departing before October 31, if he has completed his transition. Lawson’s board of directors will conduct a search for Barbieri’s successor and announced it will name Stefan Schulz, Lawson senior vice president and global controller, as acting chief financial officer, if a replacement is not found by the end of October.
In addition to announcing its unaudited financials, Lawson also announced the acquisition of Competency Assessment Solutions (CAS), a provider of Web-based performance management software for the healthcare industry. The CAS acquisition extends Lawson’s existing set of healthcare applications and addresses compliance-related issues in that field. CAS is based in Princeton, New Jersey.