Future 'rosy' for Peoplesoft at number one

By ADAM GIFFORD


After a year of consolidation and change, Peoplesoft has emerged as the number one enterprise applications company by revenue and sites.

New Zealand sales manager Andrew Batchelor refused to discuss financials because the company is in its quiet time before reporting end-of-year results, but said "the future is rosy".

During the year Peoplesoft worldwide merged with JD Edwards, which had a strong New Zealand presence, giving the combined company here 72 staff and about 120 customers.

The most recent accounts filed with the Companies Office show that in 2002 Peoplesoft's operating revenue here was $30 million, giving it a profit of $1.3 million. That compares with a profit of almost $2.5 million on revenue of $23.4 million in 2001.

Significant deals during 2002 included New Zealand Post and Air New Zealand. This year it won Sky City with Peoplesoft software and New Zealand Milk with Peoplesoft Enterprise One, which is the new name for the main JD Edwards product line.

JD Edwards, which closed its financial year on October, had revenue of $10.4 million for 2002 and a loss of $1.3 million. That was almost exactly what it wrote off in goodwill associated with the 2000 acquisition. If the trend continues, combined revenue for 2003 should be more than $40 million, even more than arch-rival SAP at its peak.

SAP, meanwhile, is expecting double growth on 2002's $27.7 million, which was a huge leap on the $17.3 million it turned over in 2001.

It will also hope to at least match its 2002 profit of $3.3 million, a $6.8 million turnaround on the previous year.

Peoplesoft needs to build up its licence sale revenue, considered the foundation of a healthy software business. In 2001 it sold $15.6 million of licences and $1.5 million in consulting services. Last year licence sales dropped to $11.7 million but consulting jumped to $9.1 million. Much of that extra revenue made its way to Peoplesoft Australia to pay for the consultants flown out to handle the implementations.

Peoplesoft's success comes from winning most of the big deals on offer. Oracle isn't making the sort of noise in applications it makes in databases, and SAP has the Fonterra sale under its belt.