By Brian White
Baan Company NV, the Dutch ERP company has forecast higher than expected fourth quarter losses, a huge fall in revenues and re-statement of third quarter figures to show even bigger losses. It expects to show a net loss for the final three months of $250m or $1.22 a share, mainly due to a $160m charge for restructuring. This is well above the $110 figure it forecast when the cuts were first announced (CI No 3,528). The rationalization of Baan involved the sacking of 1,200 staff – 20% of its global workforce – in a bid to claw its way back to profitability by bringing costs more in line with revenues. Revenues for the fourth quarter are expected to be around $142m, 35% down on the same period a year earlier. With sales growing less rapidly, Baan says it has reduced revenue in the fourth quarter by around $50m in respect of sales to resellers. This amounts to $17m sold to end-users while the remaining $33m has been classified as deferred revenues. Meantime, Baan has bought the core assets of Baan Midmarket Solutions, an organization that resells Baan products to indirect channels, for between $32m and $80m depending on revenues over the next three years. This outfit is owned by Vanenburg Ventures BV, which is in turn owned by Baan’s founders, John and Paul Baan. Baan is also in negotiations with Vanenburg Ventures to buy some companies which license software to Baan. With the Baan brothers having left the company, Baan wants shareholders to approve an increase in the three-strong supervisory board to seven, with additional outside directors. The Baan brothers’ forced sale of a chunk of equity (CI No 3,530) which has brought their holding down from 39% to under 25% has meant that the company’s acquisition of Caps Logistics in September must be treated on a purchase rather than a pooling of interests basis. The effect of this is to cut third quarter figures by a total of $16m, making the loss per share $0.24 rather than $0.16 originally reported. In Europe the shares fell 7% yesterday to 9.10 euros.
