Baan Reports Another Loss, But Beats Forecasts
Struggling enterprise software vendor Baan Co. rebounded slightly today as it reported better-than-expected first-quarter results. Revenue for the quarter ended March 31 was $176 million, compared with $179 million in the first quarter of last year. The net loss for the quarter was $19 million, or 9 cents per share, compared with net income of $2 million, or 1 cent per share, in the same period last year. Analysts were expecting a loss of about 11 cents per share.
The company was buoyed by strong growth in its services business. Baan reported a 28% increase in maintenance and service revenues to a record $111 million, or 63% of total revenue, compared with 48% for the year-earlier period. But product license revenue, which is considered to be the best indicator of health, dropped about 30% to $65 million for the first quarter, compared with $93 million for the same period last year.
"Results for the quarter were better than the analysts' consensus projection," Jim Mooney, Baan's chief financial officer, said in a statement. "In the first quarter, the company achieved its previously announced cost-reduction targets. We believe our cost structure moving forward positions us well in what we expect will continue to be a difficult and challenging market."
Baan's share price was up 1-3/16 to 9-15/16 following the earnings announcement. The company also cited a record number of transactions in the first quarter as well as new additions to its management team as helping turn the company around.
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