<PAGE> 1
-----------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
-----------------------------------------------
Date of Report (date of earliest event reported): June 9,1998
MANUGISTICS GROUP, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S><C>
DELAWARE 0-22154 52-1469385
(State of Incorporation) (Commission File Number) (I.R.S. Employer
Identification Number)
2115 EAST JEFFERSON STREET
ROCKVILLE, MARYLAND 20852
(Address of principal executive offices (Zip Code)
</TABLE>
(301) 984-5000
(Registrant's telephone number, including area code)
------------------------------------------------------------------------
<PAGE> 2
ITEM 5. OTHER EVENTS
On Tuesday, June 9, 1998, the Company issued a press release announcing its
earnings figures for its first fiscal quarter. A copy of the press release is
attached hereto as Exhibit 99.5 and incorporated herein by reference.
ITEM 7. EXHIBITS
Exhibit Number
99.5 Press Release dated June 9, 1998.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Manugistics Group, Inc.
Date: June 9, 1998 By: /s/ PETER Q. REPETTI
----------------------------
Peter Q. Repetti
Senior Vice President and Chief Financial Officer
(Principal Financial Officer and Chief
Accounting Officer)
<PAGE> 4
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
99.5 Press Release dated June 9, 1998
<PAGE> 1
EXHIBIT 99.5
Contacts: Peter Q. Repetti
Chief Financial Officer
301-984-5409
Nate Wallace
Manager, Investor Relations
301-984-5059
FOR IMMEDIATE RELEASE
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS
ROCKVILLE, MD., JUNE 9, 1998-- Manugistics Group, Inc. (Nasdaq: MANU)
today reported quarterly revenues and earnings for the three months ended May
31, 1998.
Total revenues increased 15% to $39.8 million in the first quarter from
$34.5 million in the same quarter of the prior year. Software license revenues
decreased 17% to $16.7 million in the first quarter from $20.1 million last
year. The shortfall in revenues resulted in a net loss of $8.2 million, or $.32
per diluted share for the quarter, compared to net income of $2.0 million, or
$.09 per diluted share in the same quarter of the prior year.
"Coming on the heels of a banner fourth quarter and fiscal year, we are
particularly disappointed with the first quarter results," said William M.
Gibson, chairman and CEO of Manugistics. "It has become clear to us that two
factors primarily contributed to these results. We did not achieve an
appropriate balance between our longer-term initiatives and short-term sales
execution, and we did not successfully manage the rapid growth of our sales
organization. However, we have put in place clear action plans to effectively
address these issues and regain momentum in this growing market."
(more)
<PAGE> 2
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS PAGE 2
"Despite our performance this quarter, we remain confident in the
continued growth of the supply chain management market, in the strength of our
organization, in the superiority of our product offerings and in our continued
ability to provide leadership in the supply chain management market," added
Gibson.
Key components of Manugistics' action plan to address its sales
execution issues and financial performance through the rest of its fiscal year
include:
* More intense management of the sales organization and its day-to-day
activities. Joseph Broderick, executive vice president of client sales and
services, is now focused more directly on the field sales organization.
Broderick will concentrate his more than 20 years' experience on improving
Manugistics' sales processes and execution.
* Increased focus on delivery of rapid results to clients through
Manugistics' professional services group and consulting partner
relationships. Keith Enstice, senior vice president, who previously
reported to Broderick, is assigned to manage the professional services
business on a global basis while continuing to manage Manugistics'
relationships with strategic consulting partners, reporting to CEO William
Gibson. Enstice helped develop the professional services organization and
will bring valuable experience in leveraging Manugistics' consulting and
implementation expertise as a competitive differentiator in sales cycles.
* Effectively executing the sales and marketing initiatives which have been
developed over the past few months and rolled out over the past few weeks.
These include Manugistics' vision of customer-centric supply chain
optimization, which enables clients to achieve significant, bottom-line
results in a short timeframe.
(more)
<PAGE> 3
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS PAGE 3
"The issues that we are dealing with are manageable and well within our
control. We have learned from our experience of the first quarter that we must
not lose sight of the basics. We must and will focus more strongly on execution
during the remainder of the year," continued Gibson.
Headquartered in Rockville, Md., Manugistics Group, Inc. is the world's
most recognized name in supply chain management and has the largest global
client base of any supply chain provider. The company's solutions are used by
more than 700 companies to improve the flow of product within and among
companies from raw materials or parts through manufacturing to delivery of
product to the end customer. Manugistics' solutions for customer-centric supply
chain optimization uniquely allow its clients to create and optimize their
supply chains around their customers and are quick to implement, adapt easily to
change, and deliver rapid results. Its clients include leading companies such as
Compaq, Harley-Davidson, Nike, Frito-Lay, Wal-Mart, DuPont, and Nortel.
FORWARD LOOKING STATEMENTS
This press release contains forward looking statements that are subject
to risks and uncertainties. There are a number of important factors that could
affect the Company's performance. Demand for the Company's supply chain
management software products and the Company's quarterly operating results could
be affected by business conditions or the general economy in domestic and
international markets, the timely availability and acceptance of the Company's
products, technological change, the timing and results of the Company's
longer-term initiatives, the response of prospective customers to announced or
commercially available products or pricing, competitors' announcements and other
marketing activities, acquisitions or marketing relationships, the length of the
Company's sales cycles, or the Company's ability to integrate acquired
operations and technologies rapidly and effectively. The Company's expense
levels are based largely on its expectations of future revenues, and if revenues
were to be below expectations, the Company's operating results would be and have
been affected. The timing of releases of the Company's software products can be
affected by client needs, marketplace demands, technological advances, and
competitors' activities. The expansion of
(more)
<PAGE> 4
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS PAGE 4
the Company's operations into foreign markets, including the Asia/Pacific and
South America regions, might be affected by general economic conditions in
foreign countries, difficulties in staffing and managing international
operations, changes in foreign currency exchange rates, and political and
economic instability. For further information, please refer to the Company's
Form 10-K for the year ended February 28, 1998, and other documents and reports
filed with the Securities and Exchange Commission which are publicly available,
copies of which may also be obtained by contacting the Company's Investor
Relations department at 301-984-5409. The company assumes no obligation to
update the information contained in this press release.
(more)
<PAGE> 5
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS PAGE 5
MANUGISTICS GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
<TABLE>
<CAPTION>
May 31, February 28,
1998 1998
------------------- -------------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 8,211 $ 19,695
Marketable securities 57,078 62,246
Accounts receivable - net 45,135 58,217
Other current assets 5,872 4,882
-------- --------
Total current assets 116,296 145,040
PROPERTY AND EQUIPMENT - NET 24,674 20,909
NONCURRENT ASSETS:
Software development costs - net 22,553 22,100
Intangibles and other assets - net 15,831 16,529
Deferred tax asset 22,970 17,923
======== ========
TOTAL $202,324 $222,501
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,116 $ 8,830
Accrued liabilities 12,349 22,571
Deferred revenue 18,344 17,974
Income taxes payable - 655
-------- --------
Total current liabilities 35,809 50,030
LONG-TERM LIABILITIES 344 392
STOCKHOLDERS' EQUITY 166,171 172,079
======== ========
TOTAL $202,324 $222,501
======== ========
</TABLE>
(more)
<PAGE> 6
MANUGISTICS ANNOUNCES FIRST QUARTER RESULTS PAGE 6
MANUGISTICS GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended
May 31,
----------------------------
1998 1997
----------- -----------
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES:
Software products $ 16,738 $ 20,119
Consulting, maintenance
and other services 23,096 14,340
-------- --------
Total revenues 39,834 34,459
-------- --------
OPERATING EXPENSES:
Cost of software sold 2,825 2,460
Cost of consulting, maintenance
and other services 11,417 6,571
Sales and marketing 22,812 13,152
Product development 11,380 6,225
General and administrative 5,564 3,054
-------- --------
Total operating expenses 53,998 31,462
-------- --------
(LOSS) INCOME FROM OPERATIONS (14,164) 2,997
OTHER INCOME-NET 1,051 324
-------- --------
NET (LOSS) INCOME BEFORE INCOME TAXES (13,113) 3,321
(BENEFIT) PROVISION FOR INCOME TAXES (4,867) 1,281
-------- --------
NET (LOSS) INCOME $ (8,246) $ 2,040
======== ========
NET (LOSS) INCOME PER SHARE-BASIC AND DILUTED ($ 0.32) $ 0.09
======== ========
SHARES USED IN SHARE COMPUTATION
BASIC 25,920 21,753
DILUTED 25,920 23,297
</TABLE>
###
Manugistics, the Manugistics logo, and working as one are registered trademarks
of Manugistics, Inc. All other products or company names mentioned are used for
identification purposes only, and may be trademarks of their respective owners.
Additional information about Manugistics can be found at the company's site on
the World Wide Web, at http://www.manugistics.com.
