Supply chain management software provider Logility, Inc. rode the globalization wave to end its fiscal 2007 year with record results. The company has reported record revenues in four of its past six quarters.
For the fourth quarter, ended April 30, the company, 88% owned by American Software, recorded total revenue of $12.7 million, up 26% over the year-earlier quarter. Software license fees contributed $5.7 million, up 48% from a year ago, while services and other revenues rose 17% to $1.9 million. Maintenance revenue was $5.1 million, up 12% from the year-ago quarter, but down 9% from the quarter ended in January. Logility said it signed 24 new customers in the fourth quarter.
GAAP net earnings for the quarter were $1.9 million, compared with net earnings of $1.6 million in the fourth quarter of fiscal 2006.
For the year, revenue totaled a record $43.6 million, up 17% from $37.3 million in fiscal 2006. GAAP net earnings were $5.9 million, down from net earnings of $8 million a year earlier. However, operating earnings for the year were a record $8.4 million, an increase of 41% from $6 million a year earlier.
During the year, Logility added 111 new customers and signed software license agreements for its Voyager Solutions and Demand Solutions products with new and existing customers in 25 countries. Among its new customers are 3M South Africa, Continental Mills, Siemens Medical Solutions, and Verizon Wireless.
On a conference call with financial analysts this morning, Logility President and CEO J. Michael Edenfield called 2007 the company's "best year ever," noting that its organizational and financial stability is helping to establish relationships with customers and prospective customers. The company is operating debt-free.
"An improved economy and continued globalization of the supply chain are driving demand for our products. Many companies have, or are in the process of, or will move some or all of their sourcing offshore to Asia," Edenfield said. "While this transition certainly allows corporations to reduce their manufacturing and sourcing costs, it puts more pressure and less transparency on the supply chain process. Lead times are significantly longer, transportation costs are higher, and the cost of a mistake is greatly increased," he continued. "This is causing many of our prospective customers to focus on improving their sales and operations planning processes and systems."
Lora Cecere, a research director at AMR Research Inc., told Managing Automation, "Logility has stayed focused on serving the market niche that they know best — customer products supply chain — through a turbulent market. Their focus on serving customers has paid off."
Cecere said the market for supply chain planning software is growing at a rate of roughly 3% this year.
Looking ahead, Edenfield said the first quarter of 2008 presents "an opportunity to be as good or better than last year," although he did not provide specific guidance. He pointed to a seasonal cycle of license renewals in which the first half of Logility's year accounts for roughly 40% to 45% of the year's total.