Activant, which markets specialized ERP systems, used every tool in the financial arsenal to more than double net income while revenue fell by 12.3 percent for its June quarter. Earnings rose to $9.9 million, from $4.5 million a year earlier. Revenue dropped to $90.2 million from $102.7 million. There was an improvement in gross margins by nearly three-quarters of a percentage point while operating costs fell by 16.8 percent. A repurchase of $25 million face value debt for $19 million helped reduce interest expense by $2.2 million while providing a $4.6 million gain on the debt retirement. An increase of $3.7 million in tax expense ate part of the savings. Activant reaches the hardware and lumber, wholesale distribution and automotive market,s the latter showing a 51.6 drop in revenue. By the way, secured lenders include Lehman Commercial Paper and CIT Group/Equipment Financing. Activant believes other lenders can provide credit as needed. Read more...

Much of the summer was devoted to channel and vendor discussion of the demise of the MIS Group, Sage’s Partner of the Year for  the year ended September 30, 2008. And true, for that Houston-based business to exit was notable. Originally a Timberline VAR, it had grown by buying other Timberline VARs, but also MicroAccounting Systems and the Enterprise Resource Group, whose operations were centered on Sage’s MAS line.  But there are other signs that it’s not so easy being big. Early in 2009, Skyytek, which had been NetSuite’s largest VAR, and NetSuite, got into a nasty court fight about the circumstances regarding Skyytek’s exit from the NetSuite channel program. Then on July 14, Tectura, the largest Microsoft Dynamics VAR, filed a Notice of Exempt Offering of Securities with the SEC that said it had sold $7.5 million in securities on June 30 and that had another $2.5 million to sell. (It didn’t indicate that the sale of the remainder was inevitable.)  Tectura CEO Terry Petrzelka said the company swapped debt for equity to clean up the balance sheet.  But I don’t see businesses willingly giving away pieces of ownership lightly. On June 26, Qurius, a large Dynamics VAR headquartered in Belgium, announced it was seeking approval for a share issue valued at roughly $1.4 million “to meet a postponed acquisition payment.” Read more...

SpeedTax says that much of the interest for its Internet-based sales-and-use tax system is coming from larger companies and that has led the Laguna Hills, Calif.-based vendor to enlist consultants that serve that market. “We've been driven or requested to move more up market,” says SpeedTax president Anton Donde, who continues that high-end consultants are making those requests because sales are drying up in the upper market. To make the move possible, SpeedTax has written an integration with SAP’s R3 platform.  Donde claims the feature set was already scalable and feature-rich enough to support large enterprises, but that SpeedTax lacked the channel that could serve them. Set-up fees, of course, will be higher and he estimated that fees for an SAP installation could be $30,000 or higher. Large end users will benefit from volume pricing since they will have a much larger transaction volume than mid-market users. Read more...

Intuit has frozen executive salaries and some bonuses for the current fiscal year which ends July 31, 2010. CEO Brad Smith's salary remains at $800,000, but his bonus of $828,000, dropped from $1.7 million a year ago. CFO Neil Williams gets the same $600,000 salary while his bonus dropped to $390,000 from $400,000 Kiran Patel, EVP of small business, gets the same salary, $700,000, while his bonus dropped to $550,000 from $800,000. The salary of Alexander Lintner, SVP of global business, stayed at $585,000 while the bonus fell to $237,000 from $585,000. There were some major changes since last year as Patel headed the consumer tax group a year ago. Sasan Goodarzi, SVP of financial institutions, received a salary of $540,000 and got a bonus of $290,000. The bonus awarded last year was $395,000. Read more...