8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934

Date of Report: February 3, 2010
(Date of earliest event reported)

AGILYSYS, INC.

(Exact name of registrant as specified in its charter)

Ohio	000-5734	34-0907152
(State or other jurisdiction	(Commission File Number)	(IRS Employer Identification No.)
of incorporation)

28925 Fountain Parkway, Solon, Ohio	44139
(Address of principal executive offices)	(ZIP Code)

Registrant’s telephone number, including area code: (440) 519-8700

N/A
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition; and

Item 7.01 Regulation FD Disclosure

On February 3, 2010, Agilysys, Inc. (the “Company”) issued a press release announcing its results for the fiscal 2010 third quarter and nine months ended December 31, 2009. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein. A copy of the slide presentation for the earnings webcast conference call is also attached hereto as Exhibit 99.2 and incorporated by reference herein.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits

99.1	Press release issued by the Company dated February 3, 2010, announcing its results for the fiscal 2010 third quarter and nine months ended December 31, 2009.
99.2	Third quarter and nine months ended December 31, 2009 slide presentation for earnings webcast conference call.

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 hereunto duly authorized.

AGILYSYS, INC.
By:	/s/ Kenneth J. Kossin, Jr.
	Kenneth J. Kossin, Jr.
	Senior Vice President and Chief Financial Officer

Date: February 3, 2010

Exhibit Index

Exhibit Number	Description
99.1	Press release issued by the Company dated February 3, 2010, announcing its results for the fiscal 2010 third quarter and nine months ended December 31, 2009.
99.2	Third quarter and nine months ended December 31, 2009 slide presentation for earnings webcast conference call.

EX-99.1

Exhibit 99.1

Agilysys Reports Unaudited Fiscal 2010 Third-Quarter
and Nine-Month Results

• Revenue Increases 41% Sequentially as IT Demand Stabilizes

• Quarterly Earnings Increase Significantly to $0.64 Per Diluted Share, Versus Loss of $0.17 Per-Share in Prior-Year’s Quarter

CLEVELAND—February 3, 2010—Agilysys, Inc. (Nasdaq: AGYS), a leading provider of innovative IT solutions, today announced unaudited financial results for the fiscal 2010 third quarter and nine months ended December 31, 2009.

Fiscal 2010 Third-Quarter Unaudited Results of Operations

Revenue declined 1.7% to $220.4 million from the $224.1 million reported in the third quarter of fiscal 2009. Compared with the prior-year period, hardware sales increased 12.6%, offset by a 39.1% decline in services revenue. Software revenue during the quarter was down slightly compared with last year. Due to a higher proportion of hardware sales and lower service revenue, consolidated gross margin declined to 23.3% of sales during the period, compared with 26.3% in the prior year.

Cost-cutting initiatives and lower acquisition-related intangible amortization drove selling, general and administrative (SG&A) expense down $7.0 million, or 14.7%, to $40.5 million during the quarter. Operating income increased $11.8 million to $9.9 million, a substantial improvement from the operating loss of $1.9 million in last year’s quarter. Last year’s quarterly loss included $13.4 million in restructuring charges, compared with restructuring charges recorded in the current quarter of $0.7 million. Adjusted EBITDA (operating income plus depreciation and amortization) increased to $13.0 million for the quarter, compared with $4.8 million a year ago.

“The solid performance in the quarter reflects a stabilizing demand environment and our focus on managing cost structure,” said Martin Ellis, president and chief executive officer. “We are pleased to report that our turnaround remains on track as we generated strong net earnings during the quarter.”

Agilysys reported third-quarter net income of $14.9 million, or $0.64 per diluted share, a significant increase from the loss of $3.7 million, or $0.17 per diluted share, recorded in the previous year’s quarter. Other income in the quarter included $2.3 million from a litigation settlement and $2.4 million from the gain recognized on a distribution from the Reserve Fund. Combined these items represented $0.18 per diluted share.

Fiscal 2010 Nine-Month Unaudited Results of Operations

Nine-month fiscal 2010 revenue was $506.0 million versus $575.3 million in the comparable period of fiscal 2009, reflecting lower sales in each of the company’s three business segments. Hardware, software and services posted declines of 2.5%, 5.2%, and 39.3% respectively, versus the comparable period a year ago. Gross margin declined to 25.1% from 27.1% in last year’s nine months due to the mix of higher hardware and lower services.

SG&A declined by $30.7 million, or 19.8%, to $124.7 million, largely due to cost-reduction initiatives. Adjusted EBITDA was $14.0 million for the nine-month period, versus a loss of $161.2 million in the fiscal 2009 nine-months, which included asset impairment and restructuring charges of $182.6 million. The company reported net income of $5.3 million, or $0.23 per diluted share, for the fiscal 2010 nine-month period, compared with a net loss of $170.3 million, or $7.54 per share, in the same year-ago period.

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

Business Outlook

“Uncertainty remains regarding the macroeconomic environment and the prospects for growth in demand for IT products and services. However, we are encouraged by the improving demand environment we’ve seen in the past two quarters. Near-term, we are optimistic regarding our outlook for the final quarter of the fiscal year and expect improved year-over-year financial performance. We have successfully restructured the organization to be profitable at lower revenue levels and are now well positioned with the operating leverage to capitalize on any future increase in IT spending,” said Ellis.

Conference Call Information

A conference call will be held at 11:00 a.m. ET today to review unaudited fiscal 2010 third-quarter and nine-month results. A slide deck will be the basis for the review. Both the slide deck and the conference call can be accessed via the Investor Relations section of www.agilysys.com. Additionally, a replay of the call will be archived on the website.

Forward-Looking Language

This release contains certain management expectations, which may constitute forward-looking information within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the Private Securities Reform Act of 1995. Forward-looking information speaks only as to the date of this presentation and may be identified by use of words such as “may,” “will,” “believes,” “anticipates,” “plans,” “expects,” “estimates,” “projects,” “targets,” “forecasts,” “continues,” “seeks,” or the negative of those terms or similar expressions. Many important factors could cause actual results to be materially different from those in forward-looking information including, without limitation, competitive factors, disruption of supplies, changes in market conditions, pending or future claims or litigation, or technology advances. No assurances can be provided as to the outcome of cost reductions, business strategies, future financial results, unanticipated downturns to our relationships with customers, and macroeconomic demand for IT products and services, unanticipated difficulties integrating acquisitions, new laws and government regulations, interest rate changes, and unanticipated deterioration in economic and financial conditions in the United States and around the world or the consequences if the shareholders either approve or fail to approve the proposed Control Share Acquisition by MAK Capital announced on November 20, 2009. We do not undertake to update or revise any forward-looking information even if events make it clear that any projected results, actions, or impact, express or implied, will not be realized.

Other potential risks and uncertainties that may cause actual results to be materially different from those in forward-looking information are described in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC), under Item 1A, “Risk Factors.” Copies are available from the SEC or the Agilysys website.

Use of Non-GAAP Financial Information

To supplement the unaudited condensed consolidated financial statements presented in accordance with U.S. GAAP in this release, certain non-GAAP financial measures as defined by the SEC rules are used. Management believes that such information can enhance investors’ understanding of the Company’s ongoing operations and is a measure used in the Company’s debt agreement. The non-GAAP measures included in this release have been reconciled to the comparable GAAP measures within an accompanying table, shown on the last page of this release.

About Agilysys, Inc.

Agilysys is a leading provider of innovative IT solutions to corporate and public-sector customers, with special expertise in select markets, including retail and hospitality. The company uses technology — including hardware, software and services — to help customers resolve their most complicated IT needs. The company possesses expertise in enterprise architecture and high availability, infrastructure optimization, storage and resource management, identity management and business continuity; and

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

provides industry-specific software, services and expertise to the retail and hospitality markets. Headquartered in Cleveland, Agilysys operates extensively throughout North America, with additional sales and support offices in the United Kingdom, Singapore and Hong Kong.

News releases and other information on Agilysys are available on the Internet at: www.agilysys.com.

—FINANCIAL RESULTS FOLLOW—

Investor Contact:

Curtis Stout
Vice President and Treasurer
Agilysys, Inc.
440-519-8635
curtis.stout@agilysys.com

Media Contact:

Maureen Morreale
Senior Communications Manager
Agilysys, Inc.
440-519-8161
maureen.morreale@agilysys.com

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

	Three Months Ended						Nine Months Ended
	Dec 31,						Dec 31,
(In thousands, except share and per-share data)	2009			2008			2009			2008
Net sales:
Products	$	186,979		$	169,260		$	418,213		$	430,692
Services		33,373			54,816			87,740			144,573
Total net sales		220,352			224,076			505,953			575,265
Cost of goods sold:
Products		156,067			146,952			340,986			359,119
Services		12,956			18,102			37,914			59,994
Total cost of goods sold		169,023			165,054			378,900			419,113
Gross margin		51,329			59,022			127,053			156,152
Selling, general and administrative expenses		40,542			47,556			124,686			155,391
Asset impairment charges		238			—			238			145,643
Restructuring charges		677			13,357			745			36,930
Operating income (loss)		9,872			(1,891	)		1,384			(181,812	)
Other (income) expense:
Other (income) expense, net		(4,921	)		1,175			(5,311	)		695
Interest income		—			(59	)		(9	)		(521	)
Interest expense		246			638			673			1,090
Income (loss) before income taxes		14,547			(3,645	)		6,031			(183,076	)
Income tax (benefit) expense		(345	)		(1,402	)		658			(15,481	)
Income (loss) from continuing operations		14,892			(2,243	)		5,373			(167,595	)
Income (loss) from discontinued operations		3			(1,477	)		(38	)		(2,751	)
Net income (loss)	$	14,895		$	(3,720	)	$	5,335		$	(170,346	)
Income (loss) per share — basic
Income (loss) from continuing operations	$	0.66		$	(0.10	)	$	0.24		$	(7.42	)
Loss from discontinued operations		0.00			(0.07	)		0.00			(0.12	)
Net income (loss)	$	0.66		$	(0.17	)	$	0.24		$	(7.54	)
Income (loss) per share — diluted
Income (loss) from continuing operations	$	0.64		$	(0.10	)	$	0.23		$	(7.42	)
Loss from discontinued operations		0.00			(0.07	)		0.00			(0.12	)
Net income (loss)	$	0.64		$	(0.17	)	$	0.23		$	(7.54	)
Weighted average shares outstanding
Basic		22,624,622			22,603,641			22,625,866			22,580,726
Diluted		23,170,992			22,603,641			23,010,272			22,580,726
Cash dividends per share	$	—		$	0.03		$	0.06		$	0.09

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
BUSINESS SEGMENT INFORMATION (UNAUDITED)

	Three Months Ended						Nine Months Ended
	Dec 31,						Dec 31,
(In thousands)	2009			2008			2009			2008
Hospitality (HSG)
Total revenue	$	23,329		$	27,911		$	63,715		$	76,153
Elimination of intersegment revenue		(833	)		—			(1,890	)		(82	)
Revenue from external customers	$	22,496		$	27,911		$	61,825		$	76,071
Gross margin	$	14,312		$	15,074		$	38,089		$	43,920
		63.6	%		54.0	%		61.6	%		57.7	%
Depreciation and amortization	$	1,081		$	1,551		$	3,308		$	4,737
Operating income (loss)		4,108			3,166			6,203			(105,598	)
Adjusted EBITDA	$	5,189		$	4,717		$	9,511		$	(100,861	)
Asset impairment	$	90		$	—		$	90		$	110,851
Retail (RSG)
Total revenue	$	37,753		$	34,793		$	85,696		$	102,497
Elimination of intersegment revenue		(43	)		(3	)		(63	)		(319	)
Revenue from external customers	$	37,710		$	34,790		$	85,633		$	102,178
Gross margin	$	7,416		$	8,937		$	17,486		$	23,431
		19.7	%		25.7	%		20.4	%		22.9	%
Depreciation and amortization	$	49		$	16		$	143		$	157
Operating income (loss)		2,925			4,229			5,688			(16,085	)
Adjusted EBITDA	$	2,974		$	4,245		$	5,831		$	(15,928	)
Asset impairment	$	—		$	—		$	—		$	24,910
Technology (TSG)
Total revenue	$	162,425		$	161,451		$	360,818		$	400,199
Elimination of intersegment revenue		(2,279	)		(76	)		(2,323	)		(3,183	)
Revenue from external customers	$	160,146		$	161,375		$	358,495		$	397,016
Gross margin	$	29,601		$	33,765		$	72,240		$	85,210
		18.5	%		20.9	%		20.2	%		21.5	%
Depreciation and amortization	$	811		$	4,067		$	5,579		$	12,547
Operating income (loss)		9,648			11,817			13,434			(14,496	)
Adjusted EBITDA	$	10,459		$	15,884		$	19,013		$	(1,949	)
Asset impairment	$	—		$	—		$	—		$	9,882
Restructuring charge	$	—		$	—		$	—		$	23,573

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
BUSINESS SEGMENT INFORMATION
(Unaudited)

	Three Months Ended						Nine Months Ended
	Dec 31,						Dec 31,
(In thousands)	2009			2008			2009			2008
Corporate / Other
Gross margin	$	—		$	1,246		$	(762	)	$	3,591
Depreciation and amortization (a)	$	1,201		$	1,048		$	3,610		$	3,200
Operating loss		(6,809	)		(21,103	)		(23,941	)		(45,633	)
Adjusted EBITDA	$	(5,608	)	$	(20,055	)	$	(20,331	)	$	(42,433	)
Asset impairment	$	148		$	—		$	148		$	—
Restructuring charge	$	677		$	13,357		$	745		$	13,357
Consolidated
Total revenue	$	223,507		$	224,155		$	510,229		$	578,849
Elimination of intersegment revenue		(3,155	)		(79	)		(4,276	)		(3,584	)
Revenue from external customers	$	220,352		$	224,076		$	505,953		$	575,265
Gross margin	$	51,329		$	59,022		$	127,053		$	156,152
		23.3	%		26.3	%		25.1	%		27.1	%
Depreciation and amortization (a)	$	3,142		$	6,682		$	12,640		$	20,641
Operating income (loss)		9,872			(1,891	)		1,384			(181,812	)
Adjusted EBITDA	$	13,014		$	4,791		$	14,024		$	(161,171	)
Goodwill and intangible asset impairment	$	238		$	—		$	238		$	145,643
Restructuring charge	$	677		$	13,357		$	745		$	36,930

(a) Does not include the amortization of deferred financing fees totaling $126 and $471 for the three months ended Dec. 31, 2009 and 2008, respectively, and $346 and $584 for the nine months ended Dec. 31, 2009 and 2008, respectively, which related to the Corporate and Other segment.

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

	Dec 31,			Mar 31,
(In thousands)	2009			2009
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	24,435		$	36,244
Accounts receivable, net		182,566			151,944
Inventories, net		25,138			27,216
Deferred income taxes — current, net		4,930			6,836
Prepaid expenses and other current assets		7,717			4,564
Income taxes receivable		6,171			3,871
Assets of discontinued operations — current		282			1,075
Total current assets		251,239			231,750
Goodwill		50,612			50,382
Intangible assets, net		32,717			36,659
Deferred income taxes — non-current, net		—			511
Other non-current assets		18,243			29,008
Assets of discontinued operations — non-current		—			56
Property and equipment, net		27,067			26,070
Total assets	$	379,878		$	374,436
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	121,346		$	28,042
Floor plan financing		—			74,159
Deferred revenue		14,397			18,709
Accrued liabilities		23,902			37,807
Long-term debt — current		199			238
Liabilities of discontinued operations — current		569			1,176
Total current liabilities		160,413			160,131
Other non-current liabilities		260			—
Shareholders’ equity:		19,428			21,588
Common shares, without par value, at $0.30 stated value; authorized 80,000,000 shares; 31,606,831 shares issued and 23,031,119 shares outstanding at Dec 31,2009		9,370			9,366
Treasury stock (8,510,712 and 8,896,778 shares at Dec 31, 2009, and Mar 31, 2009, respectively)		(2,670	)		(2,670	)
Capital in excess of stated value		(9,298	)		(11,036	)
Retained earnings		203,922			199,947
Accumulated other comprehensive loss		(1,547	)		(2,890	)
Total shareholders’ equity		199,777			192,717
Total liabilities and shareholders’ equity	$	379,878		$	374,436

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Nine Months Ended
	Dec 31,
	2009			2008
Operating activities:
Net income (loss)	$	5,335		$	(170,346	)
Add: Loss from discontinued operations		38			2,751
Income (loss) from continuing operations		5,373			(167,595	)
Adjustments to reconcile net income (loss) from continuing operations to net cash provided by (used for) operating activities (net of effects from business acquisitions):
Impairment of property and equipment		238			—
Impairment of investment in The Reserve Fund’s Primary Fund		—			1,087
Impairment of goodwill and intangible assets		—			166,223
Gain on redemption of cost basis investment		—			(56	)
Gain on investment in The Reserve Fund’s Primary Fund		(2,505	)		—
Loss on the sale of securities		91			—
Depreciation		2,859			2,863
Amortization		10,127			18,362
Deferred income taxes		2,724			(20,087	)
Stock based compensation		1,709			825
Changes in working capital:
Accounts receivable		(30,622	)		(4,849	)
Inventories		2,078			(31	)
Accounts payable		93,671			(90,739	)
Accrued and other liabilities		(20,442	)		(29,404	)
Income taxes payable		(5,243	)		1,359
Other changes, net		(2	)		(823	)
Other non-cash adjustments		(1,128	)		701
Total adjustments		53,555			45,431
Net cash provided by (used for) operating activities		58,928			(122,164	)
Investing activities:
Proceeds from (claim on) The Reserve Fund’s Primary Fund		2,337			(7,657	)
Proceeds from the redemption of cost basis investment		—			9,513
Proceeds from borrowings against company-owned life insurance policies		12,500			—
Change in cash surrender value of company owned life insurance policies		(159	)		(155	)
Acquisition of businesses, net of cash acquired		—			(2,381	)
Purchase of property and equipment		(9,672	)		(4,335	)
Net cash provided by (used for) investing activities		5,006			(5,015	)
Financing activities:
Floor plan financing agreement, net		(74,159	)		131,323
Proceeds from borrowings under credit facility		5,000			—
Principal payments under credit facility		(5,000	)		—
Principal payment under long term obligations		(258	)		(71	)
Issuance of common shares		33			—
Debt financing costs		(1,520	)		—
Dividends paid		(1,360	)		(2,038	)
Net cash (used for) provided by financing activities		(77,264	)		129,214
Effect of exchange rate changes on cash		1,317			(69	)
Cash flows (used for) provided by continuing operations		(12,013	)		1,966
Cash flows of discontinued operations:
Operating cash flows		204			510
Investing cash flows		—			—
Net (decrease) increase in cash		(11,809	)		2,476
Cash at beginning of period		36,244			69,935
Cash at end of period	$	24,435		$	72,411

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

AGILYSYS, INC.
RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA
(Unaudited)

	Three Months Ended						Nine Months Ended
	Dec 31,						Dec 31,
(In thousands)	2009			2008			2009			2008
Net income (loss)	$	14,895		$	(3,720	)	$	5,335		$	(170,346	)
Plus:
Interest expense, net		246			579			664			569
Other income, net		(4,921	)		1,175			(5,311	)		695
Income tax (benefit) expense		(345	)		(1,402	)		658			(15,481	)
Depreciation and amortization expense (a)		3,142			6,682			12,640			20,641
Income (loss) from discontinued operations, net of tax		(3	)		1,477			38			2,751
Adjusted EBITDA		13,014			4,791			14,024			(161,171	)
Asset impairment charges		238			—			238			145,643
Restructuring charges		677			13,357			745			36,930
Adjusted EBITDA excluding asset impairment and restructuring charges	$	13,929		$	18,148		$	15,007		$	21,402

(a) Depreciation and amortization expense excludes amortization of deferred finance costs, totaling $126 and $471 for the three months ended Dec. 31, 2009 and 2008, respectively, and $346 and $584 for the nine months ended Dec. 31, 2009 and 2008, respectively, as such costs are already included in interest expense, net.

# # #

AGILYSYS, INC. • 28925 FOUNTAIN PARKWAY • SOLON, OH 44139 • WWW.AGILYSYS.COM

EX-99.2

Exhibit 99.2

Agilysys, Inc. (Nasdaq: AGYS) Fiscal 2010 Unaudited Third Quarter Results February 3, 2010

Forward looking statements & non-GAAP financial information Forward-Looking Language This presentation contains certain management expectations, which may constitute forward-looking information within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the Private Securities Reform Act of 1995. Forward-looking information speaks only as to the date of this presentation and may be identified by use of words such as “may,” “will,” “believes,” “anticipates,” “plans,” “expects,” “estimates,” “projects,” “targets,” “forecasts,” “continues,” “seeks,” or the negative of those terms or similar expressions. Many important factors could cause actual results to be materially different from those in forward-looking information including, without limitation, competitive factors, disruption of supplies, changes in market conditions, pending or future claims or litigation, or technology advances. No assurances can be provided as to the outcome of cost reductions, business strategies, future financial results, unanticipated downturns to our relationships with customers, and macroeconomic demand for IT products and services, unanticipated difficulties integrating acquisitions, new laws and government regulations, interest rate changes, and unanticipated deterioration in economic and financial conditions in the United States and around the world or the consequences if the shareholders either approve or fail to approve the proposed Control Share Acquisition by MAK Capital announced on November 20, 2009. We do not undertake to update or revise any forward-looking information even if events make it clear that any projected results, actions, or impact, express or implied, will not be realized. Other potential risks and uncertainties that may cause actual results to be materially different from those in forward-looking information are described in the company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC), under Item 1A, “Risk Factors.” Copies are available from the SEC or the Agilysys web site. Use of Non-GAAP Financial Information To supplement the unaudited condensed consolidated financial statements presented in accordance with U.S. GAAP in this presentation, certain non-GAAP financial measures as defined by the SEC rules are used. Management believes that such information can enhance investors’ understanding of the Company’s ongoing operations and is a measure used in the Company’s debt agreement. The non-GAAP measures included in this presentation have been reconciled to the comparable GAAP measures within an accompanying table, shown on the last page of this presentation.

Q3 review: highlights Revenue grew 41% sequentially due to stabilizing demand environment - year-over-year revenue was down 2% Gross margin declined to 23.3% from 26.3% in fiscal Q3 2009 due to higher hardware content and lower services SG&A declined $7.0M primarily due to full-realization of previously announced cost saving initiatives and lower intangible amortization Adjusted EBITDA, excluding restructuring and asset impairment charges, was $13.9M compared with $18.2M in prior-year quarter - decline in EBITDA is primarily a result of lower gross profit EPS from continuing operations in third quarter was $0.64 compared with a loss of $0.10 in prior-year quarter

Q3 review: consolidated results Hardware revenue increased 13%, services decreased 39% and software decreased 1% from prior year SG&A, excluding depr. & amort., decreased $3.9M primarily due to lower professional fees and T&E Adjusted EBITDA, excluding charges, decreased $4.3M primarily due to lower gross profit EPS from continuing operations increased to $0.64 per share from a loss of $0.10 Q3 Year-over-Year Commentary Three Months Ended December 31 2009 2008 % Net sales $220.4 $224.1 (1.7%) Cost of goods sold $169.1 $165.1 2.4% Gross profit $51.3 $59.0 (13.1%) 23.3% 26.3% SG&A (excl. depr. & amort.) $37.7 $41.6 (9.6%) Depreciation & amortization2 $2.8 $5.9 (52.7%) Asset impairment charges $0.2 $0.0 nm Restructuring charges $0.7 $13.4 (94.5%) Operating income/(loss) $9.9 ($1.9) Other (income)/expense ($4.9) $1.2 Interest expense/(income) $0.2 $0.6 Income/(loss) before income taxes $14.5 ($3.6) Income tax benefit ($0.3) ($1.4) Income/(loss) from cont. ops. $14.9 ($2.2) Income/(loss) from disc. ops., net of taxes $0.0 ($1.5) Net income/(loss) $14.9 ($3.7) Diluted earnings per share: Continuing operations $0.64 ($0.10) Discontinued operations $0.00 ($0.07) Net income/(loss) $0.64 ($0.17) Adjusted EBITDA excl. charges1 $13.9 $18.1 6.3% 8.1% (1) Excludes Asset impairment and Restructuring charges (2) $0.3M and $0.8M of developed technology amortization included in COGS for Q3FY10 and Q3FY09, respectively Statement of Operations ($Mil., except per share)

Three Months Ended December 31 2009 2008 % Net sales $22.5 $27.9 (19.4%) Cost of goods sold $8.2 $12.8 (35.9%) Gross profit $14.3 $15.1 (5.3%) 63.6% 54.1% SG&A (excl. depr. & amort.) $9.4 $11.1 (16.0%) Depreciation & amortization $0.8 $0.8 (5.0%) Asset impairment charges $0.1 $0.0 nm Operating income $4.1 $3.2 Depreciation & amortization2 $1.1 $1.6 Adjusted EBITDA $5.2 $4.7 Adjusted EBITDA excl. charges1 $5.3 $4.7 23.4% 16.9% (1) Excludes Asset impairment charge (2) $0.3M and $0.8M of developed technology amortization included in COGS for Q2FY10 and Q2FY09, respectively Q3 review: Hospitality (“HSG”) Revenue declined 19.4% due to lower hardware and implementation service revenues Gross margin increased primarily due to lower proportion of hardware sales and lower developed technology amortization SG&A, excluding depr. & amort., decreased by $1.7M Adjusted EBITDA margin, excl. charges1, increased from 16.9% to 23.4% HSG Segment Profit ($Mil.) Q3 Year-over-Year Commentary

Three Months Ended December 31 2009 2008 % Net sales $37.7 $34.8 8.3% Cost of goods sold $30.3 $25.9 16.9% Gross profit $7.4 $8.9 (16.6%) 19.7% 25.6% SG&A (excl. depr. & amort.) $4.4 $4.7 (6.6%) Depreciation & amortization $0.1 $0.0 nm Operating income $2.9 $4.2 Depreciation & amortization $0.1 $0.0 Adjusted EBITDA $3.0 $4.2 8.0% 12.1% Q3 review: Retail (“RSG”) Revenue grew 8.3% due to higher hardware and resold software sales Gross margin decreased due to higher proportion of hardware and lower resold services SG&A, excl. depr. & amort., decreased $0.3M on lower bad debt expense Adjusted EBITDA declined $1.2M as a result of lower gross profit RSG Segment Profit ($Mil.) Q3 Year-over-Year Commentary

Q3 review: Technology (“TSG”) Three Months Ended December 31 2009 2008 % Net sales $160.1 $161.4 (0.8%) Cost of goods sold $130.5 $127.6 2.3% Gross profit $29.6 $33.8 (12.4%) 18.5% 20.9% SG&A (excl. depr. & amort.) $19.1 $17.9 6.9% Depreciation & amortization $0.8 $4.1 (80.2%) Operating income $9.6 $11.8 Depreciation & amortization $0.8 $4.1 Adjusted EBITDA $10.5 $15.9 6.5% 9.9% Sales were flat compared to prior year as IT budgets loosened at year-end Gross margin contracted in quarter primarily due to mix of higher hardware and lower services SG&A, excl. depr. & amort., increased $1.2M Acquisition-related intangible amortization decreased by $3.3M due to fully amortizing certain intangible assets in Q1 TSG Segment Profit ($Mil.) Q3 Year-over-Year Commentary

Q3 review: Corporate Three Months Ended December 31 2009 2008 $ Net sales $0.0 $0.0 $0.0 Cost of goods sold $0.0 ($1.2) $1.2 Gross profit $0.0 $1.2 ($1.2) SG&A (excl. depr. & amort.) $4.8 $7.9 ($3.1) Depreciation & amortization $1.2 $1.0 $0.2 Asset impairment charges $0.1 $0.0 $0.1 Restructuring charge $0.7 $13.4 ($12.7) Operating (loss) ($6.8) ($21.1) $14.3 Depreciation & amortization $1.2 $1.0 $0.2 Adjusted EBITDA ($5.6) ($20.1) $14.5 Adjusted EBITDA excl. charges1 ($4.8) ($6.7) $1.9 (1) Excludes Asset impairment and Restructuring charges Gross profit decreased $1.2M due to recording miscellaneous pricing adjustments in prior year SG&A, excl. depr. & amort., decreased $3.1M Corporate Segment ($Mil.) Q3 Year-over-Year Commentary

FY10 fiscal-to-date (“FTD”) review: consolidated results Nine Months Ended December 30 2009 2008 % Net sales $506.0 $575.3 (12.0%) Cost of goods sold $379.0 $419.1 (9.6%) Gross profit $127.1 $156.2 (18.7%) 25.1% 27.2% SG&A (excl. depr. & amort.) $113.0 $137.1 (17.6%) Depreciation & amortization2 $11.7 $18.4 (36.4%) Asset impairment charges $0.2 $145.6 (99.8%) Restructuring charges $0.7 $36.9 (98.0%) Operating income/(loss) $1.4 ($181.8) Other (income)/expense ($5.3) $0.7 (857.1%) Interest expense $0.7 $0.6 16.7% Income/(loss) before income taxes $6.0 ($183.1) Income tax expense/(benefit) $0.7 ($15.5) Income/(loss) from cont. ops. $5.3 ($167.6) Loss from disc. ops., net of taxes $0.0 ($2.8) Net income/(loss) $5.3 ($170.4) Diluted earnings per share: Continuing operations $0.23 ($7.42) Discontinued operations $0.00 ($0.12) Net income/(loss) $0.23 ($7.54) Adjusted EBITDA excl. charges1 $15.0 $21.4 3.0% 3.7% (1) Excludes Asset impairment and Restructuring charges (credits) (2) $1.0M and $2.3M of developed technology amortization included in COGS for FTD Q3FY10 and FTD Q3FY09, respectively Revenue declined 12.0% HSG revenue decreased 18.8% RSG revenue decreased 16.2% TSG revenue decreased 9.7% SG&A, excl. depr. & amort., decreased by $24.1M primarily due to significant cost saving initiatives Other income increased $6.0M primarily due to CTS litigation settlement and distributions from Reserve Fund EPS improved to $0.23 from a loss of $7.54 largely due to lower depreciation and amortization, asset impairment and restructuring charges and other income FTD Year-over-Year Commentary Statement of Operations ($Mil., except per share)

Q3 review: summary balance sheet performance Cash at Dec. 31st was $24.4M - a decrease of $23.8M from 9/30/09 largely due to: Paying vendor $16.6M to take advantage of early-pay discount Seasonal investment in working capital related to higher sales Cash at Dec. 31st does not include $2.4M distribution from Reserve Fund received in late January Days sales outstanding were 74 days compared to 72 days at 9/30/09 Capital expenditures were $3.7M Q3 Sequential Commentary Working Capital ($Mil.) Working capital is (A/R + Inventory) less (A/P + IGF flooring + Deferred Revenue) Quarterly revenue annualized at historical quarterly skew Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10 Receivables 172 151.9 105 125.2 182.6 Working capital as % of sales 0.049 0.091 0.051 0.05 0.098 Inventory 25.5 27.2 20.4 22 25.1

Quarterly revenue Jun ’08 Sep ’08 Dec ’08 Mar ’09 Jun ’09 Sep ’09 Dec ’09 EBITDA 117 118.7 161.4 111 89.8 109 160 Jun ’08 Sep ’08 Dec ’08 Mar ’09 Jun ’09 Sep ’09 Dec ’09 Organic 25 23.4 27.9 23.6 16 23 22.5 HSG Revenue ($Mil.) TSG Revenue ($Mil.) Jun ’08 Sep ’08 Dec ’08 Mar ’09 Jun ’09 Sep ’09 Dec ’09 Organic 38 29.3 34.8 20 24.4 24 37.7 RSG Revenue ($Mil.) AGYS Consolidated Revenue ($Mil.) Jun ’08 Sep ’08 Dec ’08 Mar ’09 Jun ’09 Sep ’09 Dec ’09 EBITDA 180 171.4 224.1 155.5 130.2 156 220

Outlook IT capital spending environment has stabilized compared to early 2009 IT growth outlook remains uncertain for calendar year 2010 Expect corporate customers to remain cautious in early calendar 2010 waiting further indications of economic recovery Remain focused on managing costs and working capital to drive cash flow Expect fourth quarter demand to be similar to prior year Expect to generate cash flow of approximately $15M to $20M in FY10

Agilysys, Inc. (Nasdaq: AGYS) Fiscal 2010 Unaudited Third Quarter Results February 3, 2010

Three Months Ended Nine Months Ended (In thousands) December 31, December 31, 2009 2008 2009 2008 Net income (loss) $ 14,895 $ (3,720) $ 5,335 $ (170,346) Plus: Interest expense, net 246 579 664 569 Other (income)/expense, net (4,921) 1,175 (5,311) 695 Income tax (benefit) expense (345) (1,402) 658 (15,481) Depreciation and amortization expense (a) 3,142 6,682 12,640 20,641 Income/(loss) from discontinued operations, net of tax (3) 1,477 38 2,751 Adjusted EBITDA 13,014 4,791 14,024 (161,171) Asset impairment charges 238 - 238 145,643 Restructuring charges 677 13,357 745 36,930 Adjusted EBITDA excluding asset impairment and restructuring charges $ 13,929 $ 18,148 $ 15,007 $ 21,402 (a) Depreciation and amortization expense excludes amortization of deferred financing fees totaling $126,000 and $471,000 for the three months ended December 31, 2009 and 2008, respectively, and $346,000 and $584,000 for the nine months ended December 31, 2009 and 2008, respectively, as such costs are already included in interest expense, net. Reconciliation of net income/(loss) to adjusted EBITDA