Sales Up 16 Percent in Q1 as Kronos Launches Wares for Manufacturers
February 12, 2007 Timothy Prickett Morgan
Workforce management software maker Kronos keeps humming along, growing organically after making a number of key acquisitions in years past. With the company having come to dominate its niche software market, the only question now is why Oracle, Infor, or SAP have not acquired it yet.
In its fiscal 2007 first quarter ended December 30, 2006, Kronos reported sales of $148.7 million, up 16 percent. While product sales were only up 9 percent to $52.2 million, Kronos had $10.6 million in subscription revenue, a new category of sales for the company. Maintenance fees rose by 13 percent in the quarter to $52.1 million, and professional services fees were essentially flat at $33.8 million. Net income fell by 8 percent to $5.7 million (18 cents per share) earning Kronos some of the wrath of Wall Street–but not too much.
Kronos said that it expects sales to be in the range of $154 million to $159 million in the fiscal 2007 second quarter ended in March, and that net income would be in the range of 23 cents to 28 centers per share. For the full fiscal 2007 year, ended in October, the company expects to have sales of $647 million to $660 million and earnings per share of $1.15 to $1.27.
In addition to reporting its financial results, Kronos also recently added a new hybrid software-service product it is calling Kronos for Manufacturing. Having heavily automated customer relationships and supply chain operations, Kronos believes that manufacturers are overdue to automate the way they handle their employees, the projects they work on, and the resources that they embody. Kronos for Manufacturing is a mix of time and attendance, scheduling, labor tracking, and shop floor data collection software that is specifically geared for manufacturers and which plugs into their ERP systems to make sure that people and parts all meet on the floor to make products. The offering includes services for implementing and tuning the software to support lean manufacturing and Six Sigma quality assurance efforts.