SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF THE
SECURITIES EXCHANGE ACT OF 1934

For the month of: December 2003

Commission File Number: 333-103019

Geac Computer Corporation Limited (Translation of registrant’s name into English)

11 Allstate Parkway, Suite 300, Markham, Ontario L3R9T8 Canada (Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or
Form 40-F.      Form 20-F  [X]     Form 40-F  [   ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes  [   ]      No  [X]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with
Rule 12g3-2(b): 82- ________

     On November 26, 2003, Geac Computer Corporation Limited filed on the SEDAR website maintained by the Canadian Depository for Securities Limited at www.sedar.com a press release issued on November 26, 2003, a copy of which is attached as Exhibit 99.1 to this Report of Foreign Private Issuer on Form 6-K.

     On December 5, 2003, Geac Computer Corporation Limited filed on the SEDAR website maintained by the Canadian Depository for Securities Limited at www.sedar.com a press release issued on December 4, 2003, a copy of which is attached as Exhibit 99.2 to this Report of Foreign Private Issuer on Form 6-K.

     On December 5, 2003, Geac Computer Corporation Limited filed on the SEDAR website maintained by the Canadian Depository for Securities Limited at www.sedar.com its Management Discussion and Analysis, a copy of which is attached as Exhibit 99.3 to this Report of Foreign Private Issuer on Form 6-K.

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, thereunto duly authorized.

GEAC COMPUTER CORPORATION LIMITED

/s/ Craig C. Thorburn

Craig C. Thorburn
Senior Vice President, Mergers & Acquisitions,
and Corporate Secretary

Date: December 9, 2003

EXHIBIT INDEX

Number	Title
99.1	Press Release issued on November 26, 2003
99.2	Press Release issued on December 4, 2003
99.3	Management Discussion and Analysis

  EX-99.1 3 e16419ex99_1.htm PRESS RELEASE ISSUED 11/26/2003

Exhibit 99.1

News Release

EARNINGS ADVISORY:

Geac to announce Second Quarter, Fiscal 2004 Results
On December 4, 2003

MARKHAM, ON, Canada - November 26, 2003 - Geac (TSX: GAC), a global enterprise software company for business performance management, today announced it will release second quarter, fiscal 2004 financial results on December 4, 2003, at 4:30 p.m. Eastern Time. The company will discuss the results on a conference call and webcast on December 4, 2003, beginning at 5:00 p.m. Eastern Time.

Listeners can access the conference call at 416.695.5806 or 1.800.273.9672, or via webcast at http://www.investors.geac.com.

A replay of the conference call will be available from December 4, 2003, at 7:00 p.m. Eastern Time until December 11, 2003, at 11:59 p.m. Eastern Time. The replay can be accessed at 416.695.5800 or 1.800.408.3053. The pass code for the replay is 1499591.

For more information, contact:
Melody Firth
Geac
Investor Relations
Tel. 905.475.0525 ext. 3325
Fax 905.475.3847
Email:melody.firth@geac.com

  GRAPHIC 4 geaclogo.gif GRAPHIC begin 644 geaclogo.gif M1TE&.#=ASP!8`'<``"'^&E-O9G1W87)E.B!-:6-R;W-O9G0@3V9F:6-E`"P` M````SP!8`(<``````#,``&8``)D``,P``/\`,P``,S,`,V8`,YD`,\P`,_\` M9@``9C,`9F8`9ID`9LP`9O\`F0``F3,`F68`F9D`F!$4LJ;-FSASZJPY"]&L:[.ZS'`8 M$1'%BJP2LCJZLZG3IU`[CD1H4.&LG@X>9'6`:"K)@R-'_A3HE6#9KU33%CQ+ M%JQ;M6;?KI4;%R[:N7;;?F35IW$IQXM"'2]?[?/I?X=2C9R_H4_??H5H'V__& M&&AY<\])6:UF#F#%^/?@*XYMU%YR3E8X'A>]<6;2JS,LA5IV%V7EXC5;2<0A*U1%F)2YKD7 MW(@OEDBB=C-:%R.-9,V05$->7-,%41>NA9R$(KFV@H5!V@98#M?,H-5W62$0 M69)_F=?:D2$%XAJ25(;F17VL^'8-&41QF9J6_]FDG)E='N8A&7QE%5F4#S!) MXXTVKGB-E:VQA:=`:);U9XTF$FKHH(CJ*1!#'3:T&R(/<=4E*WP265.?;1*( MR`PR^/@``CTB@I]^DPZ)TW%L9AK5CY$Q]`!-.6C_Y!X^ MX--6L]#WZ6")PJCH7RAB66BQ,N*FWK.!D,AL4I1YUJQPU$)[W5E?.L";5CIZ MZ)!X2?+I'H;K(:<9KNIEINZZ-:W&YY6S#31+#@CX1>:3BFVE()64QC:>N^R] M9@67E16]$"U9!?@>40+(/D(J;41:RH6UO`1AY,;;(6HFDD>I?% M9F;"(:-'L,'?2GD-O@\\\&V4/5YK+$+WGO1`CY^9'"&S=X(%1X-@*4DS1L(I)(ZF=]?#M4I&9F1SL!404(CG9J55!-4-L-"PD9;V1%; M)'7:`Y7=GM9=N>JML/GA_[J7JX[A-Z5!=M--&(3*5H1BW`21;%&:%PG-]D', M!3:GHQW6_!!J4&W:$&0*995QW:9NE-[IJ*=^EM2,'[3V0?->A#C';F-D:Y1Y MXQ>LWJ\>>BQ!77RZ&$D,Y4R=K8R_:*O"`$0\5=G"Q1;W\TL3A_CJ`Z%ME]T/ M13940ZU&.KI./SK@!><^;NUZZ1JIE[+"ENF:/YO3#'@QTS&`D[QF^#DX'- M__^N!Y(H,4E4IO'>IQZ#F]\-9`:064M7!D*:H`UI6N9JXOZ8Q\7V.!%00B34 M[)8%%M-X:S0."16#'#`^D+CD(*WHPBR.D@,[*4U@(6F:1>QFI#Y>J8^L,1Q' M0R$)@FF8W?$$@?I[I.X1` MBE\S$,1O[.6[>?F)+M64CMVFDDU;NLV*(&0+$!/%"O!D923?,R%#N]8U4FVD M)X%I8)A<8D>-V`J3%HEI/^E74>3LYZ;-4YQ=0Q*KK?2H%1]B82OV%=C'R!$X MLQ#$OAQS1(;,0FP=>9J1_'9)CF7QD1R-G$8)QSZ1K#$R1RVK0+"VQA6NI"\M M64A@N@;:AO"EK1NQVD?D"COD_WC0=!3=8B%G.=-!?LF,P?KMAV0PEKXNL;!" M):9OG/FI>#Y@>MC!:Y\0%=6T\#&9<:'M\71*'>98"E%F5&?Z5@@^LI2/K"5= M89U&THKO=66&L_581[3;-HG&EZYZ!:%,;1N2X'T(J,(E9A2!TH4`!^ZX*YDB M*X2;-P>,K6&=S4AE;>YE7G!M7&[-PIS$>82^`Z'G'FMI&K&*0J"9H4]9DJ.>]P#>4HE+I[,\E:P M@LYTLEWVE=ORVI.4$$V0EF31Y]2:'.,]L0=>'?&R0P;LN=*BM[2D*G5"G\+' MA3':@A"-7,$8'3\2:D:4L7E9TJPTY?Q^NM:KH6I5`@V1H\03BD)&,)%Y4\!B M5I5I^U08HRMMK)=Q,6G485G!=+4VS1PI.-KNXFU%[9#\"&(LP5)J7TY,AJ[\ M)"$A[=MA]!EM6HNL)NW:)ZT=U&90U\UA2,JWONU5&Y0>OB;*)69ZCM.FVQRWT3QY47PBMFD:ZDCBO_\6HZS;JKEA<( M.(M5+IUF3NA1B>?9./\BE8NV,^Q.T^<8"UP MC[OU&XKN@`^\X`=/^,(+ON]ZSWO9$^]WQ"_^\8XW MO.3G+I;)6UX@#[;74BK>+^-=7O/!:D7FHW*558UNG`-D/$,ALE+50Y[OL#?( MK/(S*[\XWBL1>7?L!^(`.!4D>%WQ7*H>2RO)S\(+F0\3Z.(Y>J?($+8Z:6=! MXNBMT8*((X"=NN"#QQ9(-9\P'M+^_TU$I4`VVNN7V>OGBX:XLQ"7B*4K^B='!(%6,C$0)"83K:00B^%[)L9&GN0D3!(K._APM'=])3ADCK4C7^(J=O1G^2$#`A@\ M$1%!W(%2+P@F*,5&G_0C*?B"))&#Q9,5-*%\^*(0OO)$#U`69*)`)H%LX4,\ M>_,C7B`#(`(8Q6>`#3):3J)"@R%]OS4X4%1PL"3W74@BE$C&.U%MXX$,,T)8"E1F-A?@)D;+*X*;N8'XNQ4!X2$>4S M&%I($HX4*YPCBZR(A[%4AKQG>^C'-?]21ZAQB@]9BXOA*O(TCRR%?J,!CAXH MBG5HD$W"1D*1'S\QBIW()!I)$"L)C"3)$+0H?;?H407&0!0!*6S_83YG,4Q, M"#J\]R\"$8]`D0.=0A8>HD;4Q@K4&"<&""+!N'K-E(YA$1&>XF(IIU)-])2> MLE#D&(%C.'T(D!1Q>(,S0`9Q`T5C0R8^PG*Y,8S742<`*6+AMR2,Q$8R(1Y" M460)28?=]Y4@68]M]24$Q)"B2)C7((0XF3ZM6(?91X>1@9+`8S,6P8W5B(O0 MIY@(\3/!PWL/.)2PU9&<^)<#F(L&\5@%5A\"`5^M*)DL^9'?(A[PA)I/%(KW M(IO]`I+`4WV,A)<,&2M3`BFD(I10Z2D9HY7H$XQ802K26!#J(WL,T8S7.(`? MZ2'1V8FT2!`RP'*H`46K6)V<:1`C]QE#Z^$2"T$1(AE#\`4I"14\#T`1B=`X;%NQH-2N0D9*K4@ M+O98KEF;?;$0:@0Z`Y8^A4B'"=42:I0Q"0%;7K$2_"@0,4$2CR5/2BB1YG5S MLA24^3*74^/K)4#$6"Q)0S%)'S@K3*)480&<@],A$9&=4(27 M;Y0A4GB3(T4B\G86BX&DDQ1:1"4($KB60R86D.4179<:7UH1$O2EZQ2F.R&8 E(&&F`_AYA">#;/JF.T&#ETD@M[=[BE>G;*=W@/&%=MIX`0$`.S\_ ` end EX-99.2 5 e16419ex99_2.htm PRESS RELEASE ISSUED 12/04/2003

Exhibit 99.2

News Release

GEAC ANNOUNCES FISCAL YEAR 2004 SECOND QUARTER RESULTS

Revenue Increases $9.6 Million from Same Quarter Last Year to $111.5 Million
Software License Revenue Rises 25.6 Percent Year Over Year
Company Delivers Earnings Per Share of $0.13 Cents

MARKHAM, Ontario - December 4, 2003 - Geac Computer Corporation Limited (TSX: GAC), a global enterprise software company for Business Performance Management, today announced its second quarter financial results for the period in fiscal year 2004 ended October 31, 2003.

All numbers are in U.S. dollars unless otherwise noted.

Second Quarter Financial Highlights

 • Revenue of $111.5 million, an increase of $9.6 million compared to the second quarter of fiscal year 2003, and an increase of $10.0 million compared to $101.5 million in the first quarter of this year;

 • Software license revenue of $15.3 million, compared to $12.2 million in the second quarter of fiscal year 2003;

 • Net income of $10.7 million, or $0.13 per diluted share in the second quarter of fiscal year 2004, compared to $11.6 million or $0.15 per diluted share the second quarter of fiscal year 2003;

 • Improved gross profit margin from 58.8% to 59.5% compared to the second quarter of fiscal year 2003, and from 57.0% to 59.6% compared to the first six months of fiscal year 2003.

 • Following the acquisition of Comshare for $53.8 million, which closed during the quarter, the cash position is $46.9 million, at October 31, 2003.

“In this quarter, we have focused on the most critical components of Geac’s reinvention - organically growing our business along certain product lines, integrating important product and organizational components of our recent acquisitions and developing new extensions and integration applications in support of our performance management strategy,” said Charles S. Jones, President and CEO of Geac. “While we see and act upon additional opportunities to

extract costs from the business, we will continue to make important investments in development and marketing to fuel sales and license revenue growth. Through enhanced service and support programs and through new sales initiatives, we are committed to extending our relationships with existing customers and to attracting new ones.”

Second Quarter Financial Review

Geac reported revenue in the second quarter of fiscal year 2004 of $111.5 million, an increase of $9.6 million, compared to $101.9 million in revenue in the second quarter of fiscal year 2003, and an increase of $10.0 million compared to $101.5 million in the first quarter of this year. The Company’s net income was $10.7 million, or $0.13 per diluted share, compared with net income of $11.6 million, or $0.15 per diluted share last year. Net income in the second quarter of fiscal year 2004 increased by $1.3 million from $9.4 million, or $0.11 per diluted share, in the first quarter of this year. The gross profit margin increased to 59.5% of revenue from 58.8% in the second quarter of fiscal year 2003, and from 57.0% to 59.6% compared to the first six months of fiscal year 2003.

Operating expenses were $50.3 million, in the second quarter of fiscal year 2004, compared to $41.3 million in the corresponding period last year. The year over year increase in operating expenses is primarily attributable to the Comshare and Extensity acquisitions.

Commenting on second quarter results, Donna de Winter, Chief Financial Officer of Geac, stated, “While we are pleased with a decline in G&A as an overall percentage of revenue, we continue to look for ways to reduce all operating expenses and to align costs across the entire organization. We anticipate that additional efficiencies will be realized within our newly acquired business units, but we continue to prioritize integration efforts with the goal of facilitating and accelerating the selling process. With a company-wide focus on new license sales, we are committed to maintaining the gross margin as seen in this quarter.”

Acquisition Integration - Performance Management Product Family

“Geac will continue with its current segment reporting focused on its Enterprise Applications Solutions (EAS) business and its Industry Specific Applications (ISA) businesses,” Ms. de Winter confirmed. “Much like PeopleSoft with the acquisition of J.D. Edwards, and Cognos with the acquisition of Adaytum, the financials of our recently acquired companies, Extensity and Comshare, will be included within the framework of our historical reporting structure. Given the nature of the integration, reporting discrete financial information on these new entities would not be possible.”

“We are focused on bringing our customers the critical front office technologies they need to effectively manage their organizations, to remain competitive and compliant, and to extend the life of their existing systems,” said Timothy Wright, Geac’s Chief Information and Technology Officer. “With Geac Performance Management, we are delivering a range of multi-functional solutions which enable customers to set strategy, build plans, drive operations and manage their business.

Reinvention Initiatives

The Company has broadened its service offerings, expanded its delivery model, and enhanced the value of existing product lines with a series of customer-facing initiatives designed to sustain the mainframe, client server and midrange customer base by extending the value customers derive from Geac software.

Value for Maintenance - In this quarter, Geac introduced a value-based maintenance offering, which delivers new technology to users of Geac’s mainframe software products that simplifies Web-enablement of applications and integration to Geac and non-Geac systems. The new rolling two year program, which is part of an enhanced service and support offering, will be formally introduced to existing Geac E and M Series customers this month. This value-based initiative introduces customers to a broader range of Geac front-office systems, encouraging new license sales, driving professional services revenue and increasing customers’ overall investments in Geac technology and services. Geac is already in negotiation with fifteen of its E Series and M Series customers.

Hosted Application Offering - Today Geac announced the expansion of its delivery model with its new web-based thin client product, delivering access to information from any web enabled device anywhere, anytime. This product will be available in February, enabling easy access to a range of Geac applications for remote users. The hosted applications model enables Geac to mitigate the cyclical nature of new license revenue in a given quarter with sustainable annuity revenue. The Company also introduced its market leading usage-based programs, available immediately, offering customers the ability to pay only for the documents processed within Geac’s expense, travel and planning software suite.

In addition to these latest launches, Geac has expanded its delivery model by broadening the availability of its ASP offering across its Geac Performance Management product line. There are 132,000 hosted seats of Geac Performance Management presently under contract. Recently, a multi-national financial services institution increased by 18,700 its total hosted seats of Geac Expense Reports and Geac Travel Planning.

Organic Growth/Product Expansion - During the second quarter, two product line extensions had notable traction in the market. The System21/Aurora business experienced strong momentum with a 25% increase in new license revenue over the first quarter. In addition, since the launch of its latest product, Geac Library Solutions has signed 100 contracts for Vubis Smart®. With a successful selling program established in Europe, management plans to bring Vubis Smart to the U.S.

During the second quarter of fiscal year 2004, Geac was successful in leveraging an existing partnership between Comshare and Microsoft® to encompass most of our major product lines in all regions. Geac and Microsoft® are currently co-investing in joint marketing and sales programs within the Performance Management market and are leveraging opportunities within each company’s customer base with target account development.

Concluding Remarks

“Market conditions continue to be challenging for Geac. We will continue to manage closely our two recent acquisitions and remain, as ever, committed to the long-term success of our shareholders, customers and employees,” concluded Mr. Jones.

Revenue Segmentation

(Unaudited)

(In millions of U.S. dollars)

	Three months ended October 31		Six months ended October 31
	2003	2002	2003	2002
EAS*
Software	13	9	24	16
Support and Services	72	62	137	124
Hardware	6	6	11	14
	91	77	172	154
ISA**
Software	2	3	4	4
Support and Services	17	21	35	42
Hardware	1	1	2	3
	20	25	41	49
Total
Software	15	12	28	20
Support and Services	89	83	172	166
Hardware	7	7	13	17
	111	102	213	203
Geographic
Americas	57	55	110	109
Europe	46	40	86	79
Asia	8	7	17	15
Total	111	102	213	203

* Enterprise Application Systems

** Industry Specific Applications

Earnings Call

Management will discuss today’s results on a conference call scheduled for December 4, 2003 at 5:00 p.m. EDT.

The conference call can also be accessed by dialing 416.695.5806 (local area) or 800.273.9672 (toll-free). A recording of the teleconference will be archived on Geac’s web site at www.investors.geac.com. The telephone numbers to call for instant replay are 416.695.5800 or 800.408.3053. The pass code for the instant replay is 1499591. This instant replay will be available until 11:59 p.m. December 11, 2003.

The conference call will be broadcast over Geac’s web site at www.investors.geac.com. Attendees will need to log in at least fifteen minutes prior to the call.

About Geac

Geac (TSX: GAC) is a global enterprise software company for Business Performance Management, providing customers worldwide with the core financial and operational solutions and services to improve their business performance in real time. Further information is available at http://www.geac.com or through email at info@geac.com.

Geac trades on the Toronto Stock Exchange under the symbol “GAC” and had 84,777,930 common shares issued and outstanding at October 31, 2003.

This press release contains forward-looking statements that are based on current expectations, including statements regarding the anticipated benefits to Geac and its customers of the acquisitions of Extensity and Comshare, the effect of those mergers on Geac’s financial condition and results of operations and the success of Geac in selling newly developed software to new and existing customers. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. These risks and uncertainties are substantially unchanged from those presented under the “Risk Factors” heading in the “Key Information” section of our annual report on Form 20-F, No. 333-103019, for the year ended April 30, 2003 filed on October 31, 2003 with the United States Securities and Exchange Commission, and available through the website maintained by the Commission at www.sec.gov, and filed on November 3, 2003 with the Canadian Securities Administrators, and available through the website maintained by the Canadian Securities Administrators and the Canadian Depository for Securities at www.sedar.com, which risks and uncertainties are incorporated by reference herein.

For more information, please contact:

Financial Contact:
Donna de Winter
Chief Financial Officer
Geac
905.475.0525 ext. 3204
donna.dewinter@geac.com

Media and Investor Contacts:
Alys Scott
Vice President, Corporate Communications
Geac
905.940.3751
alys.scott@geac.com

Melody Firth
Investor Relations
Geac
905.475.0525 ext. 3325
melody.firth@geac.com

Geac Computer Corporation Limited
Consolidated Balance Sheets
(In accordance with Canadian GAAP)
(In thousands of U.S. dollars)

		Unaudited October 31, 2003		Audited April 30, 2003
Assets
Current assets
Cash and cash equivalents	$	46,873	$	89,819
Restricted cash and cash equivalents		486		-
Accounts receivable and other		53,704		54,721
Unbilled receivables		9,096		6,901
Future income taxes		23,716		16,238
Inventory		736		787
Prepaids and other assets (note 7)		11,806		11,898
		146,417		180,364
Restricted cash and cash equivalents		1,583		2,395
Future income taxes		12,561		23,008
Property, plant and equipment		25,192		25,649
Intangible assets		36,716		11,172
Goodwill		121,134		89,386
Other assets (note 7 and 8)		4,742		-
	$	348,345	$	331,974
Liabilities
Current liabilities
Accounts payable and accrued liabilities	$	114,321	$	94,979
Income taxes payable		34,986		31,114
Current portion of long-term debt		556		733
Deferred revenue		93,195		119,937
		243,058		246,763
Deferred revenue		2,832		2,690
Long-term debt		5,695		5,616
		251,585		255,069
Shareholders’ Equity
Share capital (note 3)		122,372		120,976
Options		163		163
Deficit		(1,761)		(21,914)
Cumulative foreign exchange translation adjustment		(24,014)		(22,320)
		96,760		76,905
	$	348,345	$	331,974

See accompanying notes to the interim consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements.

 

1

Consolidated Statements of Operations
(In accordance with Canadian GAAP)
(Unaudited)

(In thousands of U.S. dollars, except		Three months ended October 31			Six months ended October 31
share and per share data)		2003	2002		2003	2002
Revenues
Software	$	15,282	12,170	$	28,131	20,983
Support and services		89,459	82,615		171,911	165,865
Hardware		6,726	7,152		12,950	16,453
Total revenues		111,467	101,937		212,992	203,301
Cost of revenues
Software		2,279	1,384		4,136	2,982
Support and services		37,029	34,824		70,749	70,334
Hardware		5,834	5,756		11,093	14,078
Total cost of revenues		45,142	41,964		85,978	87,394
Gross profit		66,325	59,973		127,014	115,907
Operating expenses
Sales and marketing		19,850	13,775		35,989	28,540
Product development		15,368	13,093		28,666	25,641
General and administrative		15,494	15,124		31,884	28,114
Net restructuring and other unusual items (note 5)		(2,692)	(733)		(2,807)	(733)
Amortization of intangible assets		2,255	-		3,031	282
		50,275	41,259		96,763	81,844
Income from operations		16,050	18,714		30,251	34,063
Interest income		200	303		586	588
Interest expense		(308)	(119)		(424)	(254)
Other income (expense), net		(389)	127		(758)	1,531
		(497)	311		(596)	1,865
Income from operations before income taxes		15,553	19,025		29,655	35,928
Income taxes		4,807	7,382		9,502	13,805
Net income for the period	$	10,746	11,643	$	20,153	22,123
Basic net income per share	$	0.13	0.15	$	0.24	0.28
Diluted net income per share	$	0.13	0.15	$	0.24	0.28
Weighted average number of common shares outstanding   (’000s)
Basic		84,464	78,505		84,361	78,326
Diluted		85,544	80,280		85,442	80,358

See accompanying notes to the interim consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements.

 

2

Consolidated Statement of Shareholders’ Equity
(In accordance with Canadian GAAP) (In thousands of U.S. dollars, except share data)

	Share capital			Purchase warrants	Retained earnings (deficit)	Cumulative foreign exchange translation adjustment	Total shareholders’ equity
	Shares (’000s)	Amount $	Options $	$	$	$	$
Audited Balance - April 30, 2002	78,145	110,987	-	1,139	(53,944)	(24,055)	34,127
Issued for cash	58	129	-	-	-	-	129
Exercise of purchase warrants	5,000	9,860	-	(1,139)	-	-	8,721
Issued in exchange for shares of acquired company	933	-	-	-	-	-	-
Option value resulting from acquisition	-	-	163	-	-	-	163
Net income	-	-	-	-	32,030	-	32,030
Foreign exchange translation adjustment	-	-	-	-	-	1,735	1,735
Audited Balance - April 30, 2003	84,136	120,976	163	-	(21,914)	(22,320)	76,905
Issued for cash	642	1,396	-	-	-	-	1,396
Net income for the period	-	-	-	-	20,153	-	20,153
Foreign exchange translation adjustment	-	-	-	-	-	(1,694)	(1,694)
Unaudited Balance - October 31, 2003	84,778	122,372	163	-	(1,761)	(24,014)	96,760

See accompanying notes to the interim consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements.

 

3

Consolidated Statements of Cash Flows
(In accordance with Canadian GAAP)
(Unaudited)

(In thousands of U.S. dollars)	Three months ended October 31				Six months ended October 31
	2003		2002		2003		2002
Cash provided by (used in)
Operating activities
Net income for the period	$	10,746	$	11,643	$	20,153		$	22,123
Adjusted for items not involving cash:
Amortization of intangible assets		2,255		-		3,031			282
Amortization of property, plant and equipment		1,819		3,834		3,541			6,082
Amortization of other assets		135		-		135			-
Reversal of accrued liabilities and other provisions		(2,748)		(733)		(3,225)			(733)
Future income tax expense		3,303		6,049		6,595			10,680
Other		18		(971)		(17)			(825)
Cash provided by operating activities before changes in non-cash working capital and deferred revenue		15,528		19,822		30,213			37,609
Change in non-cash working capital excluding deferred revenue		(1,308)		426		5,349			(27,155)
Change in deferred revenue		(16,387)		(19,497)		(38,209)			(37,329)
Cash provided by (used in) operating activities		(2,167)		751		(2,647)			(26,875)
Investing activities
Acquisition less cash acquired		(39,019)		(2,362)		(39,019)			(2,362)
Net additions to property, plant and equipment		(933)		(184)		(1,512)			(793)
Additions to other assets		(2,804)		-		(2,804)			-
Change in restricted cash and cash equivalents		1,312		81		402			923
Cash used in investing activities		(41,444)		(2,465)		(42,933)			(2,232)
Financing activities
Issue of common shares		1,298		997		1,396			1,004
Repayment of long-term debt		(180)		(1,492)		(386)			(1,778)
Cash provided by (used in) financing activities		1,118		(495)		1,010			(774)
Effect of exchange rate changes on cash and cash equivalents		749		108		1,624			642
Cash and cash equivalents
Net decrease in cash and cash equivalents		(41,744)		(2,101)		(42,946)			(29,239)
Cash and cash equivalents - beginning of the period		88,617		46,500		89,819			73,638
Cash and cash equivalents - end of the period	$	46,873	$	44,399	$	46,873		$	44,399

See accompanying notes to the interim consolidated financial statements. These interim consolidated financial statements should be read in conjunction with the annual consolidated financial statements.

 

4

Geac Computer Corporation Limited
Notes to Consolidated Financial Statements
(In accordance with Canadian GAAP)
(Unaudited)
Unless otherwise stated, amounts are in thousands of U.S. dollars except share data and per share amounts.

1.  SIGNIFICANT ACCOUNTING POLICIES

These interim consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles, using the same accounting policies as outlined in note 2 to the consolidated financial statements for the year ended April 30, 2003 except as noted below. These interim consolidated financial statements do not conform in all respects with disclosures required for annual financial statements and should be read in conjunction with the consolidated financial statements for the year ended April 30, 2003 in the 2003 Annual Report.

The financial statements of the Company have historically been reported in Canadian dollars. Effective May 1, 2003 the Company adopted the U.S. dollar as its reporting currency as U.S. dollar denominated operations represent an increasingly significant proportion of the Company’s operations. Comparative financial information has been recast as if the new reporting currency had always been used, and financial statements have been reported in U.S. dollars for all periods presented.

Effective May 1, 2003 the Company changed its policy with respect to the classification of reimbursements received for out-of-pocket expenses to classify these amounts as revenue. In previous years these reimbursements had been characterized as a reduction of expenses incurred. The change has been applied retroactively and comparative figures restated. In addition, effective May 1, 2003 the Company has reclassified certain “bug-fixing” expenses that had been characterized as support costs in certain product lines as product development expenses across all product lines. In the Consolidated Statement of Operations for the quarter ended October 31, 2003 results for the comparable period ended October 31, 2002 have been restated to conform with the current year’s presentation. The net effect of the change in policy and reclassification on results for the 3 months ended October 31, 2002 was to increase support and services revenue by $773 (6 months ended October 31, 2002 - $1,555), to reduce support and services costs by $1,066 (6 months ended October 31, 2002 - $2,009), and to increase product development expenses by $1,839 (6 months ended October 31, 2002 - $3,564). There was no impact on net income for the quarter or 6 months ended October 31, 2002.

2.  STOCK-BASED COMPENSATION

The Company has two stock-based compensation plans which are described in note 13 to the consolidated financial statements in the 2003 Annual Report. The Company did not issue any new stock options to employees during the first quarter of fiscal 2004. During the second quarter of fiscal 2004, the Company issued 4.59 million stock options in total to employees at a weighted average exercise price of $4.39. These options vest over a period of 4 years. They were all granted at an exercise price the same as or above the market value of the shares at the date of grant.

The weighted average estimated fair value at the date of grant for employee options granted for the quarter ended October 31, 2003 was $3.10 per share. If the Company had adopted the fair value method, the total amount of compensation expense in the second quarter of fiscal year 2004 for stock options granted since fiscal 2003 would have been approximately $626 (2003 - $66) after tax and $882 in the first 6 months of fiscal 2004 (2003 - $85) after tax. The fair value of each share issued was estimated on the date of grant using the Black-Scholes option-pricing model with the following assumptions at the measurement date:

Risk-free interest rate: 4.15% - 4.35%
Expected life: 7 years
Estimated volatility in the market price of the common shares: 71.59% - 71.86%
Dividend yield: Nil

The weighted average estimated fair value at the issue date for shares issued under the Employee Stock Purchase Plan (ESPP) for the quarter ended October 31, 2003 was $0.63 per share. If the Company had adopted the fair value method, the total amount of compensation expense for shares issued under ESPP for the second quarter of fiscal year 2004 would have been approximately $4 (2003 - $10) and $11 for the first 6 months of fiscal 2004 (2003 - $22). The fair value of each share issued was estimated on the date of issue using the Black-Scholes option-pricing model with the following assumptions at the measurement date:

Risk-free interest rate: 2.83% - 3.17%
Expected life: 3 months
Estimated volatility in the market price of the common shares: 31.49% - 32.25%
Dividend yield: Nil

 

5

Geac Computer Corporation Limited
Notes to Consolidated Financial Statements
(In accordance with Canadian GAAP)
(Unaudited)
Unless otherwise stated, amounts are in thousands of U.S. dollars except share data and per share amounts.

Had the Company recorded compensation expense based on the fair value of the options at the grant date and shares issued under ESPP, results would have been as follows:

		Three months ended October 31				Six months ended October 31
		2003		2002		2003		2002
Net income - as reported	$	10,746	$	11,643	$	20,153	$	22,123
Pro forma stock-based compensation expense		630		76		893		107
Net income - pro forma		10,116		11,567		19,260		22,016
Basic net income per share - as reported		0.13		0.15		0.24		0.28
Pro forma stock-based compensation expense per share	$	0.01		-	$	0.01	$	-
Basic net income per share - pro forma		0.12		0.15		0.23		0.28
Diluted net income per share - as reported		0.13		0.15		0.24		0.28
Pro forma stock-based compensation expense per share	$	0.01		0.01	$	0.01	$	0.01
Diluted net income per share - pro forma		0.12		0.14		0.23		0.27

For the purpose of pro forma disclosure, the estimated fair value of the options is amortized to expense over their vesting period on a straight-line basis. The pro forma disclosure excludes the effect of options granted before the adoption of CICA 3870.

CICA 3870 requires additional disclosures of the Company’s stock-based compensation plans, which have already been provided in note 13, Share Capital, in the 2003 Annual Report. There are no material updates to these disclosures as at October 31, 2003.

3.  SHARE CAPITAL

The number of shares outstanding as of October 31, 2003 was 84,777,930 (April 30, 2003 - 84,136,490).

4.  SEGMENTED INFORMATION

The Company operates the following business segments, which have been segregated based on product offerings, reflecting the way that management organizes the segments within the business for making operating decisions and assessing performance.

Enterprise Applications Systems (EAS) offers software solutions, which include cross-industry enterprise business applications for financial administration and human resource functions, and enterprise resource planning applications for manufacturing, distribution and supply chain management.

Industry-Specific Applications (ISA) products include applications for the real estate, hospitality, property management and construction marketplaces, as well as a range of applications for libraries and public safety administration.

There are no significant inter-segment revenues. Segment assets consist of working capital items, excluding cash and cash equivalents. Cash and cash equivalents are considered to be corporate assets. Property, plant and equipment are typically shared by operating segments and those assets are managed by geographic region, rather than through the operating segments.

 

6

Geac Computer Corporation Limited
Notes to Consolidated Financial Statements
(In accordance with Canadian GAAP)
(Unaudited)
Unless otherwise stated, amounts are in thousands of U.S. dollars except share data and per share amounts.

		Three months ended October 31, 2003				Six months ended October 31, 2003
		EAS	ISA	Total		EAS	ISA	Total
Revenues
Software	$	13,181	2,101	15,282	$	23,974	4,157	28,131
Support and services		72,000	17,459	89,459		136,848	35,063	171,911
Hardware		5,746	980	6,726		10,889	2,061	12,950
Total revenues		90,927	20,540	111,467		171,711	41,281	212,992
Segment contribution	$	19,233	760	19,993	$	32,713	3,726	36,439

		Three months ended				Six months ended
		October 31, 2002				October 31, 2002
		EAS	ISA	Total		EAS	ISA	Total
Revenues
Software	$	9,584	2,586	12,170	$	16,641	4,342	20,983
Support and services		62,086	20,529	82,615		123,921	41,944	165,865
Hardware		5,763	1,389	7,152		13,800	2,653	16,453
Total revenues		77,433	24,504	101,937		154,362	48,939	203,301
Segment contribution	$	17,232	2,622	19,854	$	31,837	4,512	36,349

Reconciliation of segment contribution to income from operations before income taxes

		Three months ended			Six months ended
		October 31			October 31
		2003	2002		2003	2002
Segment contribution	$	19,993	19,854	$	36,439	36,349
Corporate expenses - net of recharges		(4,400)	(906)		(5,946)	(1,913)
Amortization of intangible assets		(2,255)	-		(3,031)	(282)
Interest income (expense), net		(108)	184		162	334
Net restructuring and other unusual items		2,692	733		2,807	733
Foreign exchange		(369)	(840)		(776)	707
Income from operations before income taxes	$	15,553	19,025	$	29,655	35,928

7

Geac Computer Corporation Limited
Notes to Consolidated Financial Statements
(In accordance with Canadian GAAP)
(Unaudited)
Unless otherwise stated, amounts are in thousands of U.S. dollars except share data and per share amounts.

5.  NET RESTRUCTURING AND OTHER UNUSUAL ITEMS

During the 6 months ended October 31, 2003 the Company recorded a net reversal of $2,807 in net restructuring and other unusual items, which included a reversal of $3,225 of accrued liabilities and other provisions recorded in prior years which were no longer required, partially offset by a charge of $418 for severance related to the restructuring of the Company’s business in North America. In addition, a release of $342 of excess provisions for acquisition-related liabilities was recorded in the second quarter of fiscal 2004 as an adjustment to goodwill related to that specific acquisition.

6. LITIGATION

Geac, in the normal course of business, is subject to legal proceedings brought against it and its subsidiaries, including several that are not described below. Such proceedings may be the result of disputes over, among other things, contracts, alleged torts, real estate, insurance, employee relations, or intellectual property.

In May 2001 Cels Enterprises, Inc., filed a complaint in the United States District Court for the Central District of California against Geac Computer Corporation Limited and its subsidiary Geac Enterprise Solutions, Inc. (GES). GES is the successor to JBA Holdings plc, a company acquired by Geac in 1999 (JBA). The complaint alleged that JBA software supplied to Cels by Geac was experimental and did not work. The software product in question, which was part of JBA’s product offering prior to the acquisition, is no longer sold by Geac. Cels claimed damages of $28,300. In August 2003 the jury returned a verdict against GES awarding Cels approximately $1,800 in compensatory damages and $2,300 in punitive damages, and a judgement was entered. GES has appealed the award of punitive damages, and Cels has appealed the Court’s denial of its motion seeking approximately $1,000 in attorneys’ fees. At April 30, 2003 Geac had accrued $2,000 in respect of the Cels claim. Geac increased the amount of this reserve to $4,100 at July 31, 2003.

Extensity, a subsidiary acquired by Geac in March 2003, is subject to a class action suit which alleges that Extensity, certain of its officers and directors (who are no longer employed by Geac), and the underwriters of its initial public offering in January 2000 violated the federal securities laws of the United States. The parties have submitted a settlement proposal and are awaiting court approval of the proposal. Such approval is expected in late 2003 to early 2004. If the proposed settlement is not approved, in view of the fact that Extensity is a corporate defendant, this action may divert the efforts and attention of Geac’s management and, if determined adversely, could have a material impact on Geac’s, business, financial position, results of operations and cash flows.

On March 21, 2002 Grace Consulting, Inc. (Grace), a provider of software maintenance and consulting services, filed a lawsuit against GES and Geac Computer Corporation Limited claiming antitrust violations and seeking approximately $75,000 in damages. Grace alleged that Geac was attempting to monopolize the market for maintenance services in certain Geac products by filing a copyright infringement suit against Grace and by taking other measures to prevent Grace from providing software maintenance services through the infringement of Geac’s copyrights. Geac believes this lawsuit is based on facts and circumstances substantially similar to Grace’s claims in an earlier lawsuit. In 1995, before its acquisition by Geac, Dun & Bradstreet Software Services, Inc. filed a complaint against Grace claiming copyright infringement. Grace asserted counterclaims against Dun & Bradstreet Software Services, Inc. for copyright misuse, tortious interference with contract, and breach of contract. On September 24, 2002 the United States Circuit Court of Appeals for the Third Circuit issued an opinion in Geac’s copyright infringement suit against Grace, finding that Grace’s maintenance services infringed Geac’s copyrights, reinstating Geac’s claims against Grace for misappropriation of trade secrets, and affirming the dismissal of Grace’s counterclaims for copyright misuse, tortious interference with contractual relations, and breach of contract. Grace sought review by the United States Supreme Court, but such review was denied. Grace has ceased doing business. In light of the Third Circuit’s decision, Geac believes that the claims raised in Grace’s March 2002 antitrust action are without merit because the claims raised in that suit were dependent upon Grace’s maintenance services not infringing Geac’s copyrights. However, there can be no assurance that Geac will be successful in defending against these new claims.

The ultimate outcome of these, and other, matters cannot currently be determined, nor, except as stated above, can the liability that could potentially result from a negative outcome in each case currently be reasonably estimated. In the event of a negative outcome, the liability that Geac may ultimately incur with respect to any of these matters may be in excess of amounts currently accrued with respect to such matters and, as a result, these matters may be material.

 

8

 

Geac Computer Corporation Limited
Notes to Consolidated Financial Statements
(In accordance with Canadian GAAP)
(Unaudited)
Unless otherwise stated, amounts are in thousands of U.S. dollars except share data and per share amounts.

7.  CREDIT FACILITY

On September 9, 2003 Geac and certain of its subsidiaries entered into a Loan, Guaranty and Security Agreement (the “Loan Agreement”) with Wells Fargo Foothill, Inc., pursuant to which the Company and certain of its subsidiaries obtained a three-year revolving credit facility (the “Facility”) with a $50,000 revolving line of credit and a $5,000 letter of credit sub-facility. The interest rate payable on advances under the Facility is, at Geac’s option, the prime rate plus 0.50% or LIBOR plus 3.00%. The Facility is secured by substantially all of the assets of Geac and certain of its United States and Canadian subsidiaries and guaranteed by certain of its United States, Canadian, United Kingdom and Hungarian subsidiaries. The Facility is available for the working capital needs and other general corporate purposes of Geac and its subsidiaries that are parties to the Loan Agreement. There has been no drawdown under the Facility as of October 31, 2003.

The financing costs of approximately $2,800 incurred to close the transaction were recorded as other assets in the second quarter of fiscal 2004 and amortized to expense on a straight line basis over the term of the Facility. The current portion of $934 was recorded in prepaids and other assets as of October 31, 2003.

8.  ACQUISITION

On August 6, 2003 the Company acquired Comshare, Incorporated (Comshare), a provider of corporate performance management software, based in Michigan, by way of a cash tender offer for all outstanding shares of Comshare at a price of $4.60 per share. The acquisition was accounted for by the purchase method with the results of operations of the business included in the consolidated financial statements from the date of acquisition.

The total purchase price was approximately $55,644, consisting of $53,807 of cash and $1,837 of acquisition costs. The acquired net assets included, at fair value, $16,625 of cash; $10,584 of other current assets; $909 of property, plant and equipment; $2,852 of other assets; $28,491 of acquired intangible assets, including $21,736 of acquired software, and $6,755 of customer agreements; $12,172 of current liabilities; and $24,980 of other liabilities. The Company recorded $2,709 of net future income tax assets as a component of the transaction. The difference between the purchase price and the fair value of all identifiable assets and liabilities acquired was $30,626 and is accounted for as goodwill. Goodwill is not assigned to an operating segment and is not deductible for income tax purposes.

The additions to reserves of approximately $3,125 for workforce reductions related to employees of Comshare in the development, support and services, sales and marketing, and administrative areas, and $1,867 for premises restructuring were recorded at acquisition. As at October 31, 2003 there was a charge of $1,944 against the provision for workforce reductions and $nil against the premises restructuring reserve.

The purchase price allocation for this acquisition has been based on available information at the time of preparation of these interim consolidated financial statements. To the extent that these amounts prove to be excessive or inadequate, they will be adjusted up to the end of the current year by an adjustment to goodwill.

9.  COMPARATIVE FIGURES

Certain prior year’s comparative figures in the financial statements have been reclassified to conform to the current year’s presentation.

 

9

  EX-99.3 6 e16419ex99_3.htm MANAGEMENT DISCUSSION AND ANALYSIS

Exhibit 99.3

Management Discussion and Analysis

The following management discussion and analysis of results of operations and financial position should be read in conjunction with the financial statements and notes for the second quarter ended October 31, 2003 and the audited financial statements and notes for the fiscal year (FY) ended April 30, 2003. This discussion contains certain forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. These risks and uncertainties are substantially unchanged from those presented under the “Risk Factors” heading in the “Key Information” section of our annual report on Form 20-F, No. 333-103019, for the year ended April 30, 2003 filed on October 31, 2003 with the United States Securities and Exchange Commission, and available through the website maintained by the Commission at www.sec.gov, and filed on November 3, 2003 with the Canadian Securities Administrators, and available through the website maintained by the Canadian Securities Administrators and the Canadian Depository for Securities at www.sedar.com, which risks and uncertainties are incorporated by reference herein. Unless otherwise indicated, all dollar amounts are expressed in U.S. dollars, and the word “dollars” and the symbol “$“ refer to U.S. dollars.

Our financial statements are prepared in accordance with accounting principles generally accepted in Canada (“Canadian GAAP”). The financial statements of the Company have historically been reported in Canadian dollars. Effective May 1, 2003 the Company adopted the U.S. dollar as its reporting currency, as U.S. dollar denominated operations represent an increasingly significant portion of the Company’s operations. Accordingly, the change of the Company’s reporting currency from the Canadian dollar to the U.S. dollar reduces the Company’s exposure to foreign currency translation adjustments. Comparative financial information has been recast as if the U.S. dollar had always been used as the Company’s reporting currency, and financial information has been translated into U.S. dollars for all periods presented. As used in this discussion and unless the context otherwise requires or unless otherwise indicated, all references to “Geac,” “we,” “our,” or “the Company” refer to Geac Computer Corporation Limited and its consolidated subsidiaries.

Overview

Geac is a global enterprise software company for business performance management, providing customers worldwide with the core financial and operational solutions and services to improve their business performance in real time. Our solutions include cross-industry enterprise application systems (EAS) for financial administration and human resources functions, expense management, time capture, budgeting, financial consolidation, management reporting and analysis and enterprise resource planning applications for manufacturing, distribution, and supply chain management. These cross-industry applications are marketed globally and span a number of product lines. We also provide industry specific applications (ISA) tailored to the real estate, restaurant, property management, and construction marketplaces, and for libraries,

 

Page 1 of 12

local governments and public safety agencies. In addition to our families of software products, we are a reseller of computer hardware and software, and we provide a broad range of professional services, including application hosting, consulting, implementation services, and training.

Geac today has a presence in the financial front and back offices of many of the largest companies in the world. These companies rely on Geac software applications for their financial and operational processing.

Geac Growth Strategy

Software Revenue Growth

Geac’s dual objectives are (i) to extend relationships with our existing customers by improving the productivity of those customers’ existing business processes with new products that build on those customers’ ERP and Internet frameworks, and (ii) to attract new customers by delivering a suite of software solutions that can be integrated with their existing enterprise application systems. In both cases, we aim to help our customers improve their business performance with their existing resources. An example is our Geac Performance Management suite of products (which was expanded through the acquisitions of Comshare, Incorporated (“Comshare”) in the second quarter of FY 2004 and Extensity, Inc. (“Extensity”) in the fourth quarter of FY 2003), which enables our customers to set strategy, build plans and drive operations on the back of both Geac and third party ERP products. In order to continue to do so effectively, we need to identify compelling products that are consistent with our existing suite of products and then employ one of three strategies to aggregate those offerings into a complimentary suite: build, buy and partner. We believe that, if we are successful in meeting these objectives, the result should be an increase in new software license revenues.

Build: Organic Growth/Product Expansion

Our second quarter was focused on growing our business organically along key product lines, integrating important product and organizational components of Comshare and other recent acquisitions and developing new extension and integration applications in support of our Performance Management strategy.

We have broadened our service offerings, expanded our delivery model, and enhanced the value of existing product lines with a series of initiatives designed to sustain the mainframe customer base by extending the value customers derive from Geac software.

 • Value for Maintenance - We have recently introduced a value-based maintenance offering, which delivers new technology to users of our mainframe software products that simplifies Web-enablement of applications and integration with Geac and non-Geac systems. The new program, which is part of an

 

Page 2 of 12

enhanced service and support offering, is being formally rolled out to existing Geac E and M Series customers. This value-based initiative enables customers to broaden the reach of their Geac back-office systems, and link them to many and varied front-office systems. As we expand our own range of front-office solutions, with offerings such as Geac Performance Management, we will be able to provide a range of new products and services to existing customers in support of their long-term business objectives. Additionally, we have recently initiated a campaign for customer retention that offers multiple years of support with incentives to encourage customers to extend beyond our traditional one year contract.

 • Hosted Application Offering - We have expanded our delivery model by broadening the availability of our ASP offering across our Performance Management suite. There are 132,000 individual licensed users of Geac Performance Management presently under contract. Recently, a multi-national financial services institution increased by 18,700 its total number of users utilizing the hosted Geac Expense Reports and Geac Travel Planning services. In France, the market continues to show demand for hosted solutions. Geac’s Anael business signed three new customers in the second quarter of FY 2004, building recurring subscription revenues for our business in that region. Our hosted solutions represent one of several application delivery and deployment options that we offer our customers, as part of our commitment to provide flexibility and choice. Our expanded application delivery model also includes licensed software and usage-based programs.

 • Organic Growth/Product Expansion - We continue to experience strengthening interest in our System21 Aurora line. We have signed ACS Industries, our first System21 Aurora customer in the U.S., and software deployment to many of the customers who licensed Aurora in the first and second quarter has been successful. In addition, in the last 18 months, our Libraries Division signed approximately 100 customers to Vubis Smart®, its newest product launch.

Buy: Growth Through Acquisitions

Effective August 6, 2003 we acquired Comshare, a leading provider of business performance management software for planning, budgeting, forecasting, financial consolidation, management reporting, and analysis. Along with the acquisition of Extensity, a provider of solutions to automate employee time and expense reporting, completed in the fourth quarter of FY 2003, the acquisition of Comshare is a significant step in the execution of our strategy to expand into the business performance management market. In the second quarter, Extensity’s time and resource management applications were merged with Comshare’s financial and accounting applications. This new Geac Performance Management suite has been enhanced with additional internal development, which will promote integration with existing Geac customer installations. The acquired Comshare and Extensity product lines are not yet

 

Page 3 of 12

contributing positively to our operating profits. Although management believes the new Geac Performance Management suite added to Geac’s offering by these acquisitions has been an important factor in achieving renewals of maintenance relationships with our current EAS customers.

Partner: Key Relationships

During the second quarter of FY 2004, Geac was successful in leveraging an existing partnership between Comshare and Microsoft® to encompass most of our major product lines in all regions. The two companies are working together to develop joint marketing and sales programs within the business performance management market. We will receive focused technical, marketing and sales support from Microsoft®. In turn, we intend to leverage our experience and credibility providing technology-based solutions to financial executives, to assist Microsoft® in expanding its opportunities within the finance function of enterprises.

Results of Operations

Three Month Period Ended October 31, 2003 Compared to the Three Month Period Ended October 31, 2002

Revenue - Revenue for the second quarter of FY 2004 ended October 31, 2003 was $111.5 million compared to $101.9 million in the corresponding period in FY 2003, an increase of $9.6 million, or 9.3%. An increase in software license revenue of $3.1 million, from $12.2 million to $15.3 million, and an increase in support and services revenue of $6.9 million, from $82.6 million to $89.5 million, was offset by a decrease in hardware revenue of $0.5 million, from $7.2 million to $6.7 million.

The Company will continue to report on its two major business segments; Enterprise Applications Solutions (EAS) and Industry Specific Applications (ISA). The software products acquired in the Comshare and Extensity transactions are client server products that are components of the EAS business segment. Complete integration of the acquired businesses is our stated goal, and substantial progress was made during the quarter towards accomplishing this goal. The business integration has reached a level where it is not possible to identify the expense components of the merged businesses separately. We expect there will be opportunities to extract further costs as we continue to rationalize our EAS business segment to function more efficiently in light of these recent additions.

Revenue in the EAS segment was $90.9 million in the second quarter of FY 2004, compared to $77.4 million in the second quarter of FY 2003. This year-over-year $13.5 million, or 17.4%, increase is primarily attributable to $14.7 million in revenue from the businesses acquired in the Comshare and Extensity transactions. Excluding revenue from these acquired businesses, EAS segment revenue was essentially flat.

 

Page 4 o 12

EAS software license sales to new and existing customers were $13.2 million, compared to $9.6 million in the second quarter of FY 2003. This represents an increase of $3.6 million, or 37.5%. The software products acquired in the Comshare and Extensity transactions represented $3.9 million of total EAS software license sales during the quarter. Client server software sales revenue increased by $3.9 million, substantially all of which is directly attributable to the software products acquired in the Comshare and Extensity transactions. Mainframe software sales declined by $1.0 million and mid-range software sales increased by $0.7 million. EAS software license revenue is anticipated to continue to grow through the remainder of the fiscal year as a result of license sales of the software products acquired in the Comshare and Extensity transactions and from our new System 21 Aurora application, with respect to the last of which customer response continues to exceed management expectations.

EAS support and services revenue was $72.0 million, compared to $62.1 million in the second quarter of FY 2003. Support and services revenue generated by the Comshare and Extensity businesses represented $10.8 million of the total during the quarter. Therefore, excluding this revenue, there was a $0.9 million decline. Services and other revenue, which consists primarily of professional implementation and training services, accounted for $5.2 million of the net $9.9 million increase.

In each of FY 2002 and FY 2003 we experienced a double-digit decline in North American Enterprise Server customer support revenues, which is our largest single source of support revenues. As a result of initiatives, such as our Value for Maintenance program, we have reduced the rate of decline in customer support revenues in the first six months of FY 2004 to less than 10%. We are also competitively pricing for customer retention.

EAS hardware sales revenue was $5.7 million, the same as during the second quarter of FY 2003.

ISA segment revenue was $20.5 million, compared to $24.5 million in the second quarter of FY 2003. The net $4.0 million decline was primarily attributable to reduced revenues of $3.2 million related to the Interealty division, as the result of clients’ decisions not to renew their contracts in the previous fiscal year. The ISA segment is not viewed as a growth segment for Geac and competitive pricing pressure is expected to continue. Subsequent to the quarter end, Interealty announced a multi-year $8.3 million contract with the multiple listing service of Southeast Florida, a long-standing customer that is the largest user of one of Interealty legacy MLS systems. Despite the challenges of shifting to an Internet-based business model, Interealty has migrated approximately 40 customer accounts from five different systems to the MLXchange platform in the last eighteen months.

The contribution for the EAS and ISA segments reported in the Segmented Information note (note 4) of the financial statements for the quarter ended October 31, 2003 was understated for the second quarter of FY 2004, and was overstated by the same amount for the first quarter of FY 2004. Each segment’s portion of the head office and

 

Page 5 of 12

shared services expenses was not charged to the segments for the first quarter ended July 31, 2003 and the charges for the full six-month period were applied to the segments in the second quarter. The total contribution in both segments for the six months ended October 31, 2003 accurately reflects the contribution.

Cost of revenue increased by 7.6%, to $45.1 million from $42.0 million in the corresponding period in FY 2003. These increased costs were in support of a notable increase in both software license sales and support and services revenue. The gross profit margin in the second quarter of FY 2004 increased to 59.5% of revenue from 58.8% a year ago.

Operating Expenses. Operating expenses were $50.3 million in the second quarter of FY 2004, compared to $41.3 million in the corresponding period last year. The year over year increase in operating expenses is primarily attributable to the Comshare and Extensity acquisitions.

• Sales and marketing expenses increased by $6.1 million, and sales and marketing expenses as a percentage of revenues increased from 13.5% in the second quarter of FY 2003, to 17.8% in the second quarter of FY 2004. This increase reflects personnel expenses and related sales and marketing costs intended to drive increased new software license revenue. In Q2 of FY 2004, sales and marketing expenses were $19.9 million compared to $16.1 million in Q1 of FY 2004. This increase is directly attributable to the retention of the majority of the Comshare sales organization. Results from the prior year that do not include the run rate expenses of the acquired businesses are less meaningful to compare.

• Product development expenses increased by $2.3 million, and product development expenses as a percentage of revenues increased from 12.8% in the second quarter of FY 2003 to 13.8% in the second quarter of FY 2004. This increase is primarily attributable to continued spending to support the development of applications associated with the Extensity and Comshare businesses, and the release of internally developed products in the EAS segment.

• General and administrative (G&A) expenses increased by $0.4 million; however, general and administrative expenses as a percentage of revenues decreased from 14.8% in the second quarter of FY 2003, to 13.9% in the second quarter of FY 2004. G & A decreased as a percentage of revenue from 16.1% in the first quarter of FY 2004, to 13.9% in the second quarter of FY 2004, a decrease of $0.9 million. We continue to look for ways to reduce expenses and to align costs throughout the organization. We anticipate that additional efficiencies will be realized within our EAS segment, but we continue to prioritize integration efforts with the goal of facilitating and accelerating the selling process.

Net Restructuring and Other Unusual Items. During the second quarter of FY 2004, the Company recorded a net reversal of $2.7 million in net restructuring and other unusual items, which included a reversal of $2.8 million of accrued liabilities and other provisions

 

Page 6 of 12

recorded in prior years which were no longer required, partially offset by a charge of $0.1 million for severance related to the restructuring of the Company’s business in North America.

Amortization of Intangible Assets. As a result of the intellectual property acquired in the Extensity and Comshare transactions, $2.3 million has been recorded in amortization of intangibles. In the second quarter of FY 2003 there was no charge for amortization of intangible assets on the income statement.

The purchase price allocation for the acquisition of Comshare has been based on available information at the time of the preparation of these interim consolidated financial statements. To the extent that these amounts prove to be excessive or inadequate, they will be adjusted up to the end of our current fiscal year by an adjustment to goodwill.

Other Income (Expense). Other expense of $0.4 million in the second quarter of FY 2004 was attributable to a net loss on foreign exchange. In the corresponding period last year, other income, in the net amount of $0.1 million, included $0.8 million in foreign exchange losses, offset by a $0.9 million gain on the sale of fixed assets.

Income Taxes The provision for income taxes was $4.8 million in the second quarter of FY 2004, compared to $7.4 million in the corresponding period last year. Of the total $4.8 million provision for income taxes recorded in the second quarter of FY 2004, $3.3 million reflected utilization of income tax assets, and $1.5 million represented cash taxes. Of the total $7.4 million provision for income taxes recorded in the second quarter of FY 2003, $6.1 million reflected utilization of income tax assets, and $1.3 million represented cash taxes. The effective tax rate for the second quarter of FY 2004 was 30.9%, compared to a rate of 38.8% for the second quarter of FY 2003. The decrease in the effective tax rate from the second quarter of FY 2003 to the second quarter of FY 2004 is due mainly to the use of previously unrecognized losses and timing differences to reduce income in FY 2004.

Net Income Net income was $10.7 million, or $0.13 per diluted share, compared to $11.6 million, or $0.15 per diluted share, in the second quarter of FY 2003. Compared to the second quarter of FY 2003, currency fluctuations—primarily attributable to the British Pound Sterling and the Euro against the U.S. Dollar—had the effect of increasing net income by only $0.1 million.

Results of Operations

Six Months Ended October 31, 2003 compared to the Six Months Ended October 31, 2002

Revenue - Revenue for the six months ended October 31, 2003 was $213.0 million compared to $203.3 million in the first half of FY 2003, an increase of $9.7 million, or

 

Page 7 of 12

4.8%. EAS segment revenue grew by 11.2% as a result of both acquired and organic software, while ISA segment revenue declined by 15.6%. An increase in software license revenue of $7.1 million, from $21.0 million to $28.1 million, and an increase in support and services revenue of $6.0 million, from $165.9 million to $171.9 million, was offset by a decrease in hardware revenue of $3.5 million, from $16.5 million to $13.0 million.

Revenue in the EAS segment was $171.7 million in the first six months of FY 2004, compared to $154.4 million in the first six months of FY 2003. This year-over-year $17.3 million, or 11.2%, increase is primarily attributable to $19.3 million in revenue businesses acquired in the Comshare and Extensity transactions.

EAS software license sales to new and existing customers were $24.0 million, compared to $16.6 million in the first six month of FY 2003. This represents an increase of $7.4 million, or 44.1%. The software products acquired in the Comshare and Extensity transactions represented $5.6 million of total EAS software license sales during the first six months of FY 2004. Client server software sales revenue increased by $6.1 million, substantially all of which is directly attributable to the software products acquired in the Comshare and Extensity transactions. Mainframe software sales increased by $0.3 million, and mid-range software sales increased by $1.0 million. EAS software license revenue is anticipated to continue to grow through the remainder of the fiscal year as a result of license sales of the software products acquired in the Comshare and Extensity transactions and from our new System 21 Aurora application, where customer response continues to exceed management expectations.

EAS support and services revenue was $136.8 million, compared to $123.9 million in the first six months of FY 2003. Support and services revenue generated by the Comshare and Extensity businesses represented $13.8 million of the total during the first six months of FY 2004. Therefore, excluding this revenue, there was a $0.9 million decrease. Services and other revenue, which consists primarily of professional implementation and training services, accounted for $7.2 million of the net $12.9 million increase.

EAS hardware sales revenue was $10.9 million, compared to $13.8 million during the first six months of FY 2003. This represents a 21.1% decline in hardware revenue. This declining trend is expected to continue as a result of Geac’s shift of focus away from this low margin business.

ISA segment revenue declined by $7.6 million, from $48.9 million to $41.3 million, or 15.6% as compared to the first six months of FY 2003. The decline is primarily attributable to revenue from the Interealty division, which declined by $7.2 million, reflecting significant price pressure and customer losses in the core Multiple Listing Service (MLS) application business and the continuing decline in revenue from the MLS book publishing business, which was expected. As noted above, subsequent to the end of the second quarter, a multi-year $8.3 million contract with Southeast Florida, a long

 

Page 8 of 12

standing client of the Interealty business was signed. All other ISA businesses combined accounted for the remaining $0.4 million revenue decline.

Cost of Revenues. Costs of revenues were reduced by $1.4 million, or 1.6%, from $87.4 million in the first six months of FY 2003 to $86.0 million in the first six months of FY 2004. Gross profit margins increased from 57.0% to 59.6%. Costs of software license revenues increased by $1.2 million related to licensing of third party software in several of our product lines. Costs of support and services, primarily comprised of personnel and related costs, increased by $0.4 million, or 0.6%; and support and services profit margins increased from 57.6% to 58.8%.

Operating Expenses. Operating expenses were $96.8 million, compared to $81.8 million in the first six months of last year. The results for the first six months of FY 2004 include expenses relating to the Extensity and Comshare businesses, whereas the results for the first six months of FY 2003, which pre-date the acquisition of these businesses, do not. The year over year increase in operating expenses is primarily attributable to these acquisitions.

• Sales and marketing expenses increased by $7.4 million, and sales and marketing expenses as a percentage of revenues increased from 14.0% in the first six months of FY 2003 to 16.9% in the first six months of FY 2004. Sales and marketing expenses are expected to increase as a percentage of revenue in line with the increase in software revenue as a percentage of total revenue.

• Product development expenses increased by $3.0 million, and product development expenses as a percentage of revenues increased from 12.6% in the first six months of FY 2003 to 13.5% in the first six months of FY 2004. This increase is primarily attributable to the acquisitions of Extensity and Comshare, which are designed to support Geac’s strategy of buy, build and partner for growth in the business performance management sector.

• General and administrative (G&A) expenses increased by $3.8 million; and general and administrative expenses as a percentage of revenues increased from 13.8% in the first six months of FY 2003 to 15.0% in the first six months of FY 2004. The increase is attributable to previously announced legal judgment and settlement costs and professional fees, and personnel costs associated with realigning Geac’s businesses.

Net Restructuring and Other Unusual Items. During the six months ended October 31, 2003 the Company recorded a net reversal of $2.8 million in net restructuring and other unusual items, which included a reversal of $3.2 million of accrued liabilities and other provisions recorded in prior years which were no longer required, partially offset by a charge of $0.4 million for severance related to the restructuring of the Company’s business in North America.

 

Page 9 o 12

Amortization of Intangible Assets. Amortization of intangible assets, primarily acquired software, was $3.0 million in the first six months of FY 2004, compared to $0.3 million in FY 2003. This $2.7 million increase is attributable to amortization of intangible assets associated with the Extensity and Comshare businesses, which were acquired in the fourth quarter of FY 2003 and the second quarter of FY 2004, respectively.

The purchase price allocation for the acquisition of Comshare has been based on available information at the time of the preparation of these interim consolidated financial statements. To the extent that these amounts prove to be excessive or inadequate, they will be adjusted up to the end of our current fiscal year by an adjustment to goodwill.

Other Income (Expense). Other expense of $0.8 million YTD in FY 2004 was attributable to a net loss on foreign exchange. In the corresponding period last year, other income, in the net amount of $1.5 million, included $0.7 million in foreign exchange gains, and a $0.8 million gain on the sale of fixed assets.

Income Taxes. The provision for income taxes was $9.5 million in the first six months of FY 2004, compared to $13.8 million in the corresponding period last year. Of the total $9.5 million provision for income taxes recorded in the first six months of FY 2004, $6.6 million reflected utilization of income tax assets, and $2.9 million represented cash taxes. Of the total $13.8 million provision for income taxes recorded in the first six months of FY 2003, $10.7 million reflected utilization of income tax assets, and $3.1 million represented cash taxes. The effective tax rate for the first six months of FY 2004 was 32.0%, compared to a rate of 38.4% for the first six months of FY 2003. The decrease in the effective tax rate for the first six months of FY 2003 compared to the first six months of FY 2004 is due primarily to the use of previously unrecognized losses and timing differences to reduce income in FY 2004.

Net Income. Net income was $20.2 million, or $0.24 per diluted share, compared to $22.1 million, or $0.28 per diluted share, in the first six months of FY 2003. Compared to the first six months of FY 2003, currency fluctuations--primarily attributable to the British Pound Sterling and the Euro against the U.S. Dollar--had the effect of increasing net income by $0.5 million, or $0.01 per share.

Liquidity and Financial Condition

At October 31, 2003 cash and cash equivalents totalled $46.9 million, compared to $89.8 million at April 30, 2003. Excluding from the cash and cash equivalents figure of $46.9 million at October 31, 2003 an increase of $1.6 million from the effect of foreign exchange rates, cash and cash equivalents declined by $44.5 million in the first six months of FY 2004.

During the second quarter of FY 2004, we acquired Comshare by way of a cash tender offer for all outstanding shares, followed by a cash merger for a purchase price,

 

Page 10 of 12

excluding acquisition costs, of $53.8 million. Since Comshare had $16.6 million in cash and cash equivalents at the date of acquisition, the net cash outflow resulting from completion of the transaction was $37.2 million.

Historically, the third quarter of each fiscal year has been the period in which we have recorded the highest number of renewals for maintenance and support contracts. Accordingly, cash receipts from maintenance contract renewals historically have been highest in the third quarter of the fiscal year and lowest in the first and second quarters, while maintenance revenue is recognized ratably over the year. We expect this to continue to be the case in our current year.

For the first six months of FY 2004 cash used in operating activities, including the effects of changes in both non-cash working capital and deferred revenue was $2.6 million, compared to $26.9 million in the first six months of FY 2003. Excluding changes in non-cash working capital and deferred revenue, cash provided by operating activities was $30.2 million for the first six months of FY 2004, compared to $37.6 million for the first six months of FY 2003.

Cash used in investing activities was $41.4 million in the second quarter of FY 2004, compared to cash used in investing activities of $2.5 million in the corresponding period last year. Cash used in investing activities in the second quarter of FY 2004 included $39.0 million for the purchase of Comshare, $0.9 million in additions to property, plant and equipment, $2.8 million in additions to other assets, attributable to the financing costs associated with the Wells Fargo Foothill, Inc. $50 million credit facility. There has been no drawdown under this facility as of October 31, 2003. These cash outflows were partially offset by $1.3 million in restricted cash and cash equivalents.

Cash provided by financing activities was $1.1 million in the second quarter of FY 2004 as a result of the receipt of $1.3 million in proceeds from the issuance of common shares and a repayment of long-term debt in the amount of $0.2 million. In the corresponding period last year, cash used by financing activities was $0.5 million as a result of a repayment of long-term debt in the amount of $1.5 million and the receipt of $1.0 million in proceeds from the issuance of common shares.

Accounts receivable and other, including unbilled receivables, was $62.8 million at October 31, 2003 compared to $61.6 million at the end of FY 2003. The $1.2 million increase includes the effects of a $2.3 million increase due to changes in foreign exchange rates, an $8.7 million increase associated with the Comshare acquisition, net of a $9.8 million reduction in other receivables primarily attributable to collections of outstanding receivables at October 31, 2003.

Prepaid expenses and other assets, which are comprised of deposits, prepaid maintenance, insurance, and prepaid royalties, decreased by $0.1 million, from $11.9 million at the end of FY 2003 to $11.8 million at the end of the second quarter of FY 2004.

 

Page 11 of 12

Other Assets of $4.7 million were recorded for the period ended October 31, 2003, $2.8 million of which is a pension asset acquired in the Comshare transaction and $1.9 million relating to the financing costs of the Wells Fargo financing facility.

Accounts payable and accrued liabilities were $114.3 million at the end of the second quarter of FY 2004, compared to $95.0 million at the end of FY 2003. This $19.3 million net increase is primarily attributable to a $15.5 million pension liability, and a net $4.7 million addition to premises, severance and other reserves related to the Comshare acquisition. Legal accruals increased by $2.2 million, and other liabilities increased by $4.7 million, the latter of which includes $1.7 million related to the Comshare acquisition. These increases were offset by a $7.8 million reduction in other restructuring reserves.

Deferred revenue is comprised of deferred maintenance and support revenues, which are recognized ratably over the term of the related maintenance agreement and deferred professional services revenue, which is recognized as such services are performed. The term for maintenance agreements has historically been one year; however, we have recently initiated a campaign for customer retention that offers multiple years of support with incentives to encourage customers to extend beyond one year. Deferred revenue declined by $26.6 million, from $122.6 million at the end of FY 2003 to $96.0 million at the end of the second quarter of FY 2004. Excluding the effect of both an $8.9 million increase in deferred revenue at October 31, 2003 associated with the Comshare acquisition and a $2.8 million increase attributable to foreign exchange rates, deferred revenue declined by $38.3 million, which was primarily due to attrition in maintenance and professional services contracts. In the corresponding period last year, deferred revenue declined by $37.3 million, excluding the effect of foreign exchange rates.

Commitments Not Reflected in the Balance Sheet

The Company does not have derivative financial instruments or any equity interests in unconsolidated companies or any other business arrangements related to the foregoing, that would have a material effect on the assets and liabilities of the Company at October 31, 2003.

As disclosed in note 12 to the FY 2003 financial statements and in accordance with Canadian GAAP, the Company has commitments that are not reflected in the balance sheet of the Company. These commitments include operating leases for office equipment and premises, and letters of credit, bank guarantees, and performance bonds that are routinely issued on Geac’s behalf by financial institutions, primarily in connection with premises leases and contracts with public sector customers. The Company does not have any other business arrangements, derivative financial instruments, or any equity interests in unconsolidated companies that would have a material effect on the assets and liabilities of the Company at October 31, 2003.

 

Page 12 of 12

  -----END PRIVACY-ENHANCED MESSAGE-----