Lawson Software’s accountants welcomed a boost in income in the second quarter, while its salesforce lamented a drop-off in software deals.
The provider of manufacturing- and service sector-specific enterprise software delivered a 13% improvement in net income, reporting $4.2 million in the second quarter of fiscal 2009, ended Nov. 30, 2008. Sales took a hit in the quarter, however, as the economy created what Lawson CEO Harry Debes called a “crisis of confidence” among potential enterprise software buyers. Lawson’s second-quarter revenue of $206.4 million represented a 6% decline from the prior year’s $218.6 million.
License and consulting fees led the declines, falling 9% and 15%, respectively. Only a 6% uptick in maintenance revenue kept Lawson from a deeper slump. Overall, officials said, a stronger U.S. dollar accounted for 5% of the company’s 6% revenue decline, as 40% of the company’s business comes from Europe, the Middle East, and Africa. Similar reversals of fortune have beset other enterprise software vendors recently, as bustling overseas sales are converted into a stronger U.S. currency.
Lawson fared well in the healthcare sector, where it sells its S3 product suite. But manufacturing and distribution companies proved gun shy in the second quarter.