Industry Segments

9 Months Ended

Jan. 31, 2014

Industry Segments

J. Industry Segments

We provide our software solutions through three major business segments, which are further broken down into a total of four major product and service groups. The three business segments are (1) Supply Chain Management (“SCM”), (2) Enterprise Resource Planning (“ERP”), and (3) Information Technology (“IT”) Consulting.

The SCM segment consists of Logility, a wholly-owned subsidiary, as well as its subsidiary, DMI, which together provide collaborative supply chain solutions to streamline and optimize the forecasting, production, distribution and management of products between trading partners. The ERP segment consists of (i) American Software ERP, which provides purchasing and materials management, customer order processing, financial, e-commerce and traditional manufacturing solutions, and (ii) New Generation Computing (“NGC”), which provides industry-specific business software to both retailers and manufacturers in the apparel, sewn products and furniture industries. The IT Consulting segment consists of The Proven Method, Inc., an IT staffing and consulting services firm. We also provide support for our software products, such as software enhancements, documentation, updates, customer education, consulting, systems integration services, and maintenance.

Our chief operating decision maker is the President and Chief Executive Officer (“CEO”). While the CEO is apprised of a variety of financial metrics and information, we manage our business primarily on a segment basis, with the CEO evaluating performance based upon segment operating profit or loss that includes an allocation of common expenses, but excludes certain unallocated expenses.

In the following table, we have broken down the intersegment transactions applicable to the three and nine months ended January 31, 2014 and 2013:

	Three Months Ended January 31,						Nine Months Ended January 31,
	2014			2013			2014			2013
Revenues:
Enterprise Resource Planning	$	2,630		$	2,629		$	8,678		$	9,537
Collaborative Supply Chain Management		15,908			14,868			47,043			46,673
IT Consulting		5,889			5,579			18,955			19,043
	$	24,427		$	23,076		$	74,676		$	75,253
Operating income (loss) before intersegment eliminations:
Enterprise Resource Planning	$	(1,522	)	$	(1,376	)	$	(3,682	)	$	(3,556	)
Collaborative Supply Chain Management		4,716			3,446			13,352			12,577
IT Consulting		345			221			1,644			1,227
	$	3,539		$	2,291		$	11,314		$	10,248
Intersegment eliminations:
Enterprise Resource Planning	$	(487	)	$	(456	)	$	(1,380	)	$	(1,452	)
Collaborative Supply Chain Management		463			426			1,307			1,369
IT Consulting		24			30			73			83
	$	—		$	—		$	—		$	—
Operating income (loss) after intersegment eliminations:
Enterprise Resource Planning	$	(2,009	)	$	(1,832	)	$	(5,062	)	$	(5,008	)
Collaborative Supply Chain Management		5,179			3,872			14,659			13,946
IT Consulting		369			251			1,717			1,310
	$	3,539		$	2,291		$	11,314		$	10,248
Capital expenditures:
Enterprise Resource Planning	$	24		$	17		$	117		$	334
Collaborative Supply Chain Management		26			8			78			185
IT Consulting		—			—			10			27
	$	50		$	25		$	205		$	546
Capitalized Software:
Enterprise Resource Planning	$	—		$	—		$	—		$	—
Collaborative Supply Chain Management		761			836			2,402			2,647
IT Consulting		—			—			—			—
	$	761		$	836		$	2,402		$	2,647
Depreciation and amortization:
Enterprise Resource Planning	$	222		$	222		$	663		$	691
Collaborative Supply Chain Management		210			809			1,225			2,421
IT Consulting		3			2			9			6
	$	435		$	1,033		$	1,897		$	3,118
Earnings (loss) before income taxes:
Enterprise Resource Planning	$	(1,224	)	$	(934	)	$	(2,961	)	$	(2,549	)
Collaborative Supply Chain Management		4,616			3,502			13,293			12,649
IT Consulting		345			181			1,641			1,187
	$	3,737		$	2,748		$	11,973		$	11,287

Major Customer

No one customer accounted for more than 10% of total revenues for the three and nine months ended January 31, 2014. No one customer accounted for more than 10% of total revenues for the three months ended January 31, 2013. For the nine months ended January 31, 2013, we had one major customer, The Home Depot, which accounted for approximately 11.5%, or $8.6 million of total revenues. Revenues from our major customer for the periods reported are primarily attributable to our IT consulting segment. The related accounts receivable balance for this customer was approximately $1.1 million as of January 31, 2014, and $1.6 million as of April 30, 2013.