Geac Computer Corporation Limited.

Geac Announces Fiscal Year 2006 Second Quarter Results

    Markham, Canada and Waltham, Massachusetts (ots/PRNewswire) - Geac Computer Corporation Limited (TSX: GAC and NASDAQ: GEAC), a global enterprise software company dedicated to addressing the needs of CFOs, today  announced its second quarter financial results for the quarter ended October  31, 2005.

    Note to readers: As a result of the sale of the Interealty business on October 1, 2005, the results of the operations of Interealty have been reflected as discontinued operations and have not been included in Geac's results of continuing operations for the second quarter of fiscal year (FY) 2006 and comparative periods. Geac's net earnings for the second quarter of  FY 2006, which include net earnings from discontinued operations, were $33.2 million, or $0.37 per diluted share. All references to dollars are to U.S. dollars unless otherwise noted.

    Second Quarter Financial and Other Highlights

@@start.t1@@      -  Signed definitive agreement with Golden Gate Capital for the sale of
          the Company for approximately $1.0 billion, or $11.10 per share in
          cash.
      -  Software license revenue increased 26.1% over Q2 FY 2005, and a 46.2%
          improvement over Q1 FY 2006.
      -  24.1% of software license revenue in Q2 FY 2006 came from the sale of
          new internally developed Geac products.
      -  Gross profit margin improved to 66.2% in Q2 FY 2006 from 62.4% in Q1
          FY 2006 and from 65.2% in Q2 FY 2005.
      -  EPS of $0.37 per diluted share, a 117.6% increase over same quarter
          last year (including the gain on sale of and net earnings from the
          Interealty business).
      -  $226.5 million in cash on the balance sheet as of October 31, 2005.
      -  Number of contracts closed increased from 315 in Q1 FY 2006 to 340 in
          Q2 FY 2006 in the Enterprise Applications Systems (EAS) business
          segment.
      -  Increased average deal size of deals in excess of $150,000 to $294,000
          from $284,000 in Q1 FY 2006 and from $266,000 in Q2 FY 2005.
      -  Sold Interealty business, a non-strategic business unit, for
          approximately $36.3 million in cash.
      -------------------------------------------------------------------------
      US$ thousands                                                        Q2 FY 2006      Q2 FY 2005
      -------------------------------------------------------------------------
      Software License Revenue                                            18,866            14,962
      -------------------------------------------------------------------------
      Support & Professional Services Revenue                    81,810            83,036
      -------------------------------------------------------------------------
      Hardware Revenue                                                          2,511              2,476
      -------------------------------------------------------------------------
      Total Revenue                                                            103,187          100,474
      -------------------------------------------------------------------------
      Net Earnings                                                                33,186            15,204
      -------------------------------------------------------------------------
      Net Earnings per Diluted Share
        (not in thousands):
         Continuing Operations                                              $ 0.12            $ 0.17
      -------------------------------------------------------------------------
         Discontinued Operations                                          $ 0.25            $      -
      -------------------------------------------------------------------------
         Total Diluted EPS                                                    $ 0.37            $ 0.17
      -------------------------------------------------------------------------@@end@@

    Geac reported revenue in the second quarter of FY 2006 of $103.2 million, an increase of $2.7 million compared to $100.5 million in revenue in the second quarter of FY 2005. Software license revenue totaled $18.9 million in the second quarter, a 26.1% increase over the same quarter last year when software license revenue totaled $15.0 million, and a 46.2% increase over license revenue in the first quarter of FY 2006, when software license  revenue was $13.0 million. The Company's net earnings from continuing and  discontinued operations were $33.2 million during the second quarter of FY  2006, or $0.37 per diluted share, compared with $15.2 million, or $0.17 per diluted share in the second quarter of FY 2005, a net earnings increase of  118.3% and a diluted EPS increase of 117.6%. This was comprised of $22.1  million, or $0.25 per diluted share, from discontinued operations (net of  taxes), and $11.1 million, or $0.12 per diluted share, from continuing  operations. In the second quarter of FY 2006, the gross profit margin  increased to 66.2% of revenue from 65.2% in the second quarter of last year.

    In the second quarter, Geac sold its Interealty business for $36.3 million, resulting in a $21.3 million after-tax gain in the second quarter of FY 2006. The sale of Interealty is an example of Geac's ability to turn  around challenged businesses and achieve value for non-strategic assets.

    Charles S. Jones, President and Chief Executive Officer said, "In the second quarter, we were most pleased to see particularly strong increases in our software license revenue with notable contributions from nearly all of  our ERP and Performance Management product lines, which benefited not only  from an increased number of deals, but also from an increase in the average  size of contracts in excess of $150,000. New customers were responsible for approximately 24.2% of our software license sales in the quarter. Of equal importance, organic growth trends in some areas of our business continue, as internally developed new products designed to extend the value of existing solutions contributed 24% to our overall software license revenue in the second quarter. Among the larger contracts closed in the second quarter, we were able to finalize one transaction in excess of $1 million, representing some of the spillover to which we referred in the first quarter results discussion in September."

    Mr. Jones continued, "Overall, our business continues to perform well in what has proven to be an increasingly competitive software market environment . We are extremely enthusiastic about the agreement we announced last month regarding the sale of Geac to Golden Gate Capital for approximately $1  billion pursuant to a plan of arrangement. This is expected to provide our  many product families with the advantage of size and scale as our industry continues to consolidate. We believe Golden Gate's product integration strategy, commitment to support our existing product lines and available resources will provide a long-term future for our business and will benefit our customers and employees."

    Operating expenses were $53.0 million in the second quarter of FY 2006, compared to $46.0 million the second quarter of FY 2005. Operating expenses were impacted most dramatically by an increase in net restructuring and other unusual items related to non-routine events in the second quarter. These included $2.5 million in proxy contest expenses and $1.7 million in  write-offs related to the termination of the Wells Fargo Foothill credit  facility. In addition, general and administrative costs increased in the  quarter as compared to last year due to increased expenses of an aggregate $3.1 million related to stock-based compensation, Sarbanes-Oxley compliance  and the pursuit of acquisitions.

    "Unusual items and G&A expenses in the second quarter had a demonstrable impact on net earnings. Without the costs associated with our recent acquisition activity of approximately $1.5 million, the proxy contest of approximately $2.5 million and certain write-offs with respect to our  previous credit facility of approximately $1.7 million, Geac's earnings from  continuing operations would have been $21.0 million, a notable 7.7% increase over the same quarter of our last fiscal year," said Donna de Winter, Chief  Financial Officer. "We continue to build a very strong cash position. At the  end of the second quarter of FY 2006 cash on Geac's balance sheet was $226.5  million, an 86.0% increase in the cash position of $121.8 million at the  close of the second quarter of FY 2005."

    Customers

    In the second quarter of FY 2006, Geac closed approximately 340 deals in the Enterprise Applications Systems (EAS) segment of the business.  Thirty-six of these deals each exceeded $150,000, compared to 19 in excess of  $150,000 in the first quarter of FY 2006, and the average deal size within  this group was more than $294,000, up from the average deal size of $284,000  in first quarter of FY 2006. Contract metrics in the second quarter of  FY 2006 were also strong compared to the same quarter last year, in which 21  deals exceeded $150,000 and the average deal size was approximately $266,000.  Of the 340 contracts closed in the EAS segment in the second quarter of FY 2006, approximately 50 contracts were with net new customers, reflecting  an increase in the number of new customers as a percentage of total contracts  over the previous quarter.

    Among the significant EAS deals entered into during the second quarter, Geac signed contracts with the following companies:

    MPC

    CCH, a Wolters Kluwer business and a leading provider of tax and accounting information, software, and services; Fiserv, the largest provider of information management solutions to the U.S. financial industry and parent company of Geac partner IPS-Sendero; PTT Exploration and Production Public Company Limited, an energy company in Thailand; VF Corporation, whose principal brands include Wrangler(R), Lee(R), The North Face(R), Nautica(R), and Vanity Fair(R), and who is a leader in branded apparel; and Worldspan, a leader in travel technology services for travel suppliers, travel agencies,    e-commerce sites, and corporations worldwide.

    System21

    Sandvik AB, the world's leading supplier of drilling, excavation, crushing and screening machinery, equipment, and tools for the mining and construction industries; Stearns Inc., the world's leading supplier of personal flotation devices; and Westcoast Ltd., distributor of computer products for consumers and professionals.

    RunTime

    Esprit, an international clothing designer and manufacturer; and WE Netherlands B.V., a fashion chain.

    Enterprise Server and Expense Management

    Gloucestershire NHS Health Community, provider of a comprehensive range of acute, mental health, and community services, along with primary care services to the population of Gloucestershire and parts of neighbouring counties; ICT Service Cooperatie Politie, Justitie en Veiligheid, the Dutch police; and Worldspan.

    Concluding Remarks

    "I am grateful for the continuing efforts of our employees worldwide, the support of our loyal customers and the ongoing, steadfast commitment of our shareholders during the dynamic five-years that I have been with Geac as its Chairman and then President and Chief Executive Officer. In the past five years, our employees, customers and shareholders have all contributed immensely to the long-term success of this business, and we have the track record and metrics to show it. Validating the success of our many growth initiatives, Geac's share price, in US dollar terms, has increased by nearly 276.8% over the past five years. The transformation of Geac has resulted in increased opportunity for our employees and enhanced functionality and  support for our customers, which in turn generated the opportunity for a  particularly strong return for our shareholders with the prospect of the  Golden Gate acquisition in the coming months. We continue to work with Golden Gate Capital toward closing the transaction on or before March 16, 2006. We  have satisfied the condition precedent included in the debt financing  commitment letters and referenced in the Arrangement Agreement relating to  our adjusted EBITDA for the twelve-month period ended October 31, 2005. We  expect to complete the submission of all required regulatory filings shortly,  and to provide shareholders on or about December 16, 2005 with a Management Information Circular with respect to the Special Meeting of the shareholders  to consider approval of the plan of arrangement scheduled to be held on  January 19, 2006,"concluded Mr. Jones.

    For a more in-depth analysis of these financial results and other matters discussed in this Press Release, please see our Management Discussion and Analysis, which will be filed today with the Canadian Securities Administrators at www.sedar.com and the United States Securities and Exchange Commission at www.sec.gov. This document will be posted on our website at http://www.geac.com later today.

    Earnings Call

    Charles S. Jones, President and CEO of Geac, will provide a brief overview of the results and respond to questions on a conference call scheduled for 9:00 a.m. Eastern Time on December 8, 2005.

    Listeners can access the conference call at 416.340.2216 / 866.898.9626, or via webcast at http://www.investors.geac.com. Attendees should consider logging in at least 15 minutes prior to the call.

    A replay of the conference call will be available from December 8, 2005 at 10:00 a.m. Eastern Time until January 8, 2006, 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 3169939 followed by the number sign.

    About Geac

    Geac (TSX: GAC, NASDAQ:GEAC) is a global enterprise software company that addresses the needs of the Chief Financial Officer. Geac's best-in-class technology products and services help organizations do more with less in an increasingly competitive environment, amidst growing regulatory pressure, and in response to other business issues confronting the CFO. Further information is available at http://www.geac.com or through e-mail at info@geac.com.

    This press release may contain forward-looking statements of Geac's intentions, beliefs, expectations and predictions for the future. These forward-looking statements often include use of the future tense with words such as "will," "may," "intends," "anticipates," "expects" and similar conditional or forward-looking words and phrases. These forward-looking statements are neither promises nor guarantees. They are only predictions  that are subject to risks and uncertainties, and they may differ materially  from actual future events or results. Geac undertakes no obligation to update  or revise the information contained herein. Important factors that could  cause a material difference between these forward-looking statements and  actual events include, among other things: our ability to increase revenues  from new license sales, cross-sell into our existing customer base and reduce  customer attrition; whether we are successful in consummating the transaction  with Golden Gate or successfully mitigate the adverse impact to Geac's  business if the transaction fails to close; whether we are able to deliver  products and services within required time frames and budgets to meet increasingly competitive customer demands and performance guaranties; risks  inherent in fluctuating international currency exchange rates in light of our  global operations and the unpredictable effect of geopolitical world and  local events; whether we are successful in our continued efforts to manage  expenses effectively and maintain profitability; our ability to achieve  revenue from products and services that are under development; the uncertain  effect of the competitive environment in which we operate and resulting  pricing pressures; and whether the anticipated effects and results of our new product offerings and successful product implementation will be realized.  These and other potential risks and uncertainties that relate to Geac's  business and operations are summarized in more detail from time to time in  our filings with the United States Securities and Exchange Commission and  with the Canadian Securities Administrators. Please refer to Geac's most  recent quarterly reports available through the website maintained by the SEC  at www.sec.gov and through the website maintained by the Canadian Securities Administrators and the Canadian Depository for Securities Limited at www.sedar.com for more information on risk factors that could cause actual  results to differ. Geac is a registered trademark of Geac Computer  Corporation Limited. All other marks are trademarks of their respective  owners.

@@start.t2@@      Geac Computer Corporation Limited
      Consolidated Balance Sheets
      As at October 31, 2005 and April 30, 2005
      (Unaudited)
      (amounts in thousands of U.S. dollars)
                                                                                         October         April
                                                                                         31, 2005      30, 2005
                                                                                        ----------  ----------
      Assets                                                                                          (revised -
                                                                                                         see note 2)
      Current assets:
      Cash and cash equivalents                                         $ 226,453    $ 188,134
      Restricted cash                                                                2,516          4,808
      Accounts receivable and other receivables                    37,367         46,922
      Unbilled receivables                                                        8,399          8,186
      Future income taxes                                                         7,350          8,292
      Prepaid expenses and other assets                                  5,332          7,986
      Current assets related to discontinued operations
        (note 9)                                                                            376          2,097
                                                                                        ----------  ----------
         Total current assets                                                 287,793        266,425
      Restricted cash                                                                2,800          3,039
      Future income taxes                                                        20,179         33,529
      Property, plant and equipment                                        20,170         20,882
      Intangible assets                                                          19,238         23,841
      Goodwill (note 4)                                                         109,255        110,142
      Other assets                                                                    6,107          6,045
      Long-term assets related to discontinued
        operations (note 9)                                                              -          2,263
                                                                                        ----------  ----------
         Total assets                                                          $ 465,542    $ 466,166
                                                                                        ----------  ----------
                                                                                        ----------  ----------
      Liabilities & Shareholders' Equity
      Current liabilities:
      Accounts payable and accrued liabilities                 $  59,118    $  71,528
      Income taxes payable                                                      26,102         22,997
      Current portion of long-term debt                                      409              424
      Deferred revenue                                                            80,465        110,493
      Current liabilities related to discontinued
        operations (note 9)                                                          376          3,957
                                                                                        ----------  ----------
         Total current liabilities                                         166,470        209,399
      Deferred revenue                                                              1,804          2,058
      Employee future benefits                                                22,490         26,334
      Asset retirement obligations (note 6)                            1,221          1,678
      Accrued restructuring (note 7)                                          898          1,769
      Long-term debt                                                                 4,163          4,630
                                                                                        ----------  ----------
         Total liabilities                                                      197,046        245,868
      Shareholders' Equity
      Common shares; no par value; unlimited shares
        authorized; issued and outstanding as at
        October 31, 2005 - 87,317,871 (April 30,
        2005 - 86,377,012)                                                      137,827        131,445
      Common shares purchased as at October 31,
        2005 - 1,390,112
      (April 30, 2005 - 816,598) (note 10)                          (11,775)        (6,979)
      Common stock options                                                            12                12
      Contributed surplus                                                        12,025          6,353
      Retained earnings                                                         156,017        111,541
      Cumulative foreign exchange translation adjustment    (25,610)      (22,074)
                                                                                        ----------  ----------
         Total shareholders' equity                                        268,496        220,298
                                                                                        ----------  ----------
         Total liabilities and shareholders' equity          $ 465,542    $ 466,166
                                                                                        ----------  ----------
                                                                                        ----------  ----------

      Commitments and contingencies (note 12)
      See accompanying notes
      Geac Computer Corporation Limited
      Consolidated Statements of Earnings
      (Unaudited)
      (amounts in thousands of U.S. dollars, except share and per share data)
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                 ----------------------  ----------------------
                                                      2005            2004            2005            2004
                                                 ----------  ----------  ----------  ----------
      Revenue:                                                 (revised -                      (revised -
                                                                    see note 2)                  see note 2)
         Software                          $  18,866    $  14,962    $  31,771    $  30,363
         Support and services            81,810         83,036        162,399        166,732
         Hardware                                 2,511          2,476          6,293          4,379
                                                 ----------  ----------  ----------  ----------
            Total revenue                  103,187        100,474        200,463        201,474
      Cost of revenue:
         Costs of software                  2,221          1,929          4,103          3,405
         Costs of support and
          services                              30,810         31,130         62,003         61,826
         Costs of hardware                  1,881          1,877          5,357          3,413
                                                 ----------  ----------  ----------  ----------
            Total cost of revenue        34,912         34,936         71,463         68,644
                                                 ----------  ----------  ----------  ----------
      Gross profit                            68,275         65,538        129,000        132,830
      Operating expenses:
         Sales and marketing              18,003         17,201         36,932         35,040
         Research and development      12,982         13,371         27,330         27,275
         General and administrative  15,722         13,522         26,610         27,602
         Net restructuring and
          other unusual items
          (note 7)                                4,202            (367)         4,169         (1,020)
         Amortization of intangible
          assets                                  2,050          2,290          4,344          4,536
                                                 ----------  ----------  ----------  ----------
            Total operating expenses  52,959         46,017         99,385         93,433
      Earnings from continuing
        operations                              15,316         19,521         29,615         39,397
         Interest income                      1,888              674          3,436          1,176
         Interest expense                      (190)          (368)          (564)          (756)
         Other income, net                        26              722              605              244
                                                 ----------  ----------  ----------  ----------
      Earnings from continuing
        operations before income
        taxes                                      17,040         20,549         33,092         40,061
         Income taxes                          5,935          5,982         11,820         12,433
                                                 ----------  ----------  ----------  ----------
      Net earnings from continuing
        operations                              11,105         14,567         21,272         27,628
      Discontinued operations, net
        of income taxes (note 9)        22,081              637         23,204          1,088
                                                 ----------  ----------  ----------  ----------
      Net earnings                        $  33,186    $  15,204    $  44,476    $  28,716
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
      Net earnings per share
        basic (note 11):
         Continuing operations      $      0.13    $      0.17    $      0.25    $      0.32
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
         Discontinued operations  $      0.26    $      0.01    $      0.27    $      0.02
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
      Net earnings per share        $      0.39    $      0.18    $      0.52    $      0.34
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
      Net earnings per share
        diluted (note 11):
         Continuing operations      $      0.12    $      0.17    $      0.24    $      0.32
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
         Discontinued operations  $      0.25    $          -    $      0.26    $      0.01
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
      Net earnings per share        $      0.37    $      0.17    $      0.50    $      0.33
                                                 ----------  ----------  ----------  ----------
                                                 ----------  ----------  ----------  ----------
      Geac Computer Corporation Limited
      Consolidated Statement of Shareholders' Equity
      For the six months ended October 31, 2005 and the year ended
      April 30, 2005
      (Unaudited)
      (in thousands of U.S. dollars, except share date)
                                                                    Share capital
                                    ------------------------------------------------------
                                                                         Common
                                        Common                        Shares                          Common
                                        Shares                      Purchased                        Stock
                                        ('000s)      Amount      ('000s)        Amount      Options
                                    ---------- ---------- ---------- ---------- ----------
      Balance -
        April 30, 2004          85,175  $ 124,019                -  $          -  $         44
      Issuance of common
        stock for cash                443         2,125                -                -                -
      Exercise of stock
        options granted
        in connection
        with acquisition
        of Extensity                      -              28                -                -            (28)
      Stock based
        compensation
        (note 10)                          -                -                -                -                -
      Exercise of stock
        option                                -            320                -                -                -
      Employee stock
        purchase plan
        (note 10)                          -            260                -                -                -
      Net earnings                        -                -                -                -                -
      Foreign exchange
        translation
        adjustment                         -                -                -                -                -
                                    ---------- ---------- ---------- ---------- ----------
      Balance -
        October 31, 2004        85,618      126,752                -                -              16
      Issuance of common
        stock for cash                759         3,642                -                -                -
      Exercise of stock
        options granted
        in connection with
        acquisition of
        Extensity                          -                4                -                -              (4)
      Stock based
        compensation
        (note 10)                          -                -                -                -                -
      Exercise of stock
        options                              -            823                -                -                -
      Employee stock
        purchase plan
        (note 10)                          -            224                -                -                -
      Restricted share
        unit plan (note 10)          -                -                -                -                -
      Stock-based
        compensation
        expense                              -                -                -                -                -
      Purchase of common
        shares for cash                 -                -            817        (6,979)              -
      Net earnings                        -                -                -                -                -
      Foreign exchange
        translation
        adjustment                         -                -                -                -                -
                                    ---------- ---------- ---------- ---------- ----------
      Balance -
        April 30, 2005          86,377      131,445            817        (6,979)            12
      Issuance of common
        stock for cash                941         5,030                -                -                -
      Stock based
        compensation
        (note 10)                          -                -                -                -                -
      Exercise of stock
        options                              -         1,109                -                -                -
      Employee stock
        purchase plan
        (note 10)                          -            243                -                -                -
      Tax impact of
        exercise of stock
        options                              -                -                -                -                -
      Restricted share
        unit plan
        (note 10)
      Stock-based
        compensation
        expense                              -                -                -                -                -
      Purchase of
        common shares for
        cash                                  -                -            573        (4,796)              -
      Net earnings                        -                -                -                -                -
      Foreign exchange
        translation
        adjustment                         -                -                -                -                -
                                    ---------- ---------- ---------- ---------- ----------
      Balance -
        October 31, 2005        87,318    $ 137,827        1,390  $ (11,775) $         12
                                    ---------- ---------- ---------- ---------- ----------
                                    ---------- ---------- ---------- ---------- ----------
                                                                        Cumulative
                                                                         Foreign        Total
                                                                         Exchange      Share-
                                  Contributed  Retained  Translation holders'
                                         Surplus  Earnings  Adjustment    Equity
                                    ---------- ---------- ---------- ----------
      Balance -
        April 30, 2004      $    2,368  $  34,517  $ (24,877) $ 136,071
      Issuance of common
        stock for cash                  -                -                -         2,125
      Exercise of stock
        options granted
        in connection
        with acquisition
        of Extensity                      -                -                -                -
      Stock based
        compensation
        (note 10)                    1,896                -                -         1,896
      Exercise of stock
        option                          (320)              -                -                -
      Employee stock
        purchase plan
        (note 10)                      (260)              -                -                -
      Net earnings                        -        28,716                -        28,716
      Foreign exchange
        translation
        adjustment                         -                -         3,126         3,126
                                    ---------- ---------- ---------- ----------
      Balance -
        October 31, 2004         3,684        63,233      (21,751)    171,934
      Issuance of common
        stock for cash                  -                -                -         3,642
      Exercise of stock
        options granted
        in connection with
        acquisition of
        Extensity                          -                -                -                -
      Stock based
        compensation
        (note 10)                    2,222                -                -         2,222
      Exercise of stock
        options                         (823)              -                -                -
      Employee stock
        purchase plan
        (note 10)                      (224)              -                -                -
      Restricted share
        unit plan (note 10)          -                -                -                -
      Stock-based
        compensation
        expense                        1,494                -                -         1,494
      Purchase of common
        shares for cash                 -                -                -        (6,979)
      Net earnings                        -        48,308                -        48,308
      Foreign exchange
        translation
        adjustment                         -                -          (323)         (323)
                                    ---------- ---------- ---------- ----------
      Balance -
        April 30, 2005            6,353      111,541      (22,074)    220,298
      Issuance of common
        stock for cash                  -                -                -         5,030
      Stock based
        compensation
        (note 10)                    2,123                -                -         2,123
      Exercise of stock
        options                      (1,109)              -                -                -
      Employee stock
        purchase plan
        (note 10)                      (243)              -                -                -
      Tax impact of
        exercise of stock
        options                        1,261                -                -         1,261
      Restricted share
        unit plan
        (note 10)
      Stock-based
        compensation
        expense                        3,640                -                -         3,640
      Purchase of
        common shares for
        cash                                  -                -                -        (4,796)
      Net earnings                        -        44,476                -        44,476
      Foreign exchange
        translation
        adjustment                         -                -        (3,536)      (3,536)
                                    ---------- ---------- ---------- ----------
      Balance -
        October 31, 2005  $  12,025  $ 156,017  $ (25,610) $ 268,496
                                    ---------- ---------- ---------- ----------
                                    ---------- ---------- ---------- ----------
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Cash flows from                                    (revised -                      (revised -
        operating activities                          see note 2)                    see note 2)
      Net earnings for the
        period                                $  33,186    $  15,204    $  44,476    $  28,716
      Net earnings for the
        period from discontinued
        operations                              22,081              637         23,204          1,088
                                                ----------- ----------- ----------- -----------
      Net earnings for the
        period from continuing
        operations                              11,105         14,567         21,272         27,628
      Less: Adjustments to
        reconcile net income to
        net cash provided by
        operating activities:
         Depreciation                              987          1,367          2,032          2,782
         Amortization of intangible
          assets                                  2,050          2,290          4,344          4,536
         Amortization of deferred
          financing costs                         87              235              323              471
         Stock-based compensation        2,841          1,018          5,747          2,120
         Employee future benefits          232              220              470              445
         Future income tax expense      4,477          4,507          7,994          9,101
         Accrued liabilities and
          interest write off                1,042            (366)         1,009         (1,027)
         Other                                         (51)            (59)            (98)            (54)
         Changes in operating
          assets and liabilities
          (note 3)                            (21,821)      (21,612)      (34,839)      (41,648)
                                                ----------- ----------- ----------- -----------
      Net cash provided by
        operating activities from
        continuing operations                 949          2,167          8,254          4,354
      Net cash provided by
        operating activities from
        discontinued operations              834              785          1,525              794
                                                ----------- ----------- ----------- -----------
      Net cash provided by
        operating activities                1,783          2,952          9,779          5,148
      Cash flows from investing
        activities
      Proceeds from divestiture
        of Interealty, net of cash
        divested                                 36,292                 -         36,292                 -
      Purchases of investments                 -                 -                 -         (4,525)
      Sales of investments                        -                 -                 -         31,025
      Additions to property, plant
        and equipment                         (1,203)          (573)        (2,151)          (937)
      Disposals of property, plant
        and equipment                                 9                 7                27              152
      Change in restricted cash        (2,254)            (12)         2,334            (486)
                                                ----------- ----------- ----------- -----------
      Net cash provided by
        (used in) investing
        activities from continuing
        operations                              32,844            (578)        36,502         25,229
      Net cash used in investing
        activities from discontinued
        operations                                 (495)          (348)          (609)          (674)
                                                ----------- ----------- ----------- -----------
      Net cash provided by
        (used in) investing
        activities                              32,349            (926)        35,893         24,555
      Cash flows from financing
        activities
      Additions of other assets        (1,974)                -         (1,974)                -
      Issue of common shares              2,170              666          5,030          2,125
      Purchase of common shares                -                 -         (4,796)                -
      Repayment of long-term debt        (106)          (117)          (212)          (227)
                                                ----------- ----------- ----------- -----------
      Net cash provided by
        (used in) financing
        activities from continuing
        operations                                    90              549         (1,952)         1,898
      Effect of exchange rate
        changes on cash and cash
        equivalents                                 107          3,176         (5,401)         4,162
                                                ----------- ----------- ----------- -----------
      Cash and cash equivalents
      Net increase in cash and
        cash equivalents                    34,329          5,751          38,319        35,763
      Cash and cash equivalents
        - beginning of period          192,124        116,062        188,134         86,050
                                                ----------- ----------- ----------- -----------
      Cash and cash equivalents
        - end of period                $  226,453    $ 121,813    $ 226,453    $ 121,813
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      See accompanying notes
      Geac Computer Corporation Limited
      Notes to the Consolidated Financial Statements
      (Unaudited)
      (amounts in thousands of U.S. dollars, except share and per share data
unless otherwise noted)
      1.  Basis of presentation
      The accompanying unaudited consolidated financial statements have been
      prepared in United States ("U.S.") dollars and in accordance with
      Canadian generally accepted accounting principles ("Canadian GAAP") for
      interim financial statements. Accordingly, these unaudited financial
      statements do not include certain disclosures normally included in annual
      financial statements prepared in accordance with such principles. These
      unaudited financial statements were prepared using the same accounting
      policies as outlined in note 2 to the annual financial statements for the
      year ended April 30, 2005, and should be read in conjunction with the
      audited consolidated financial statements and notes included in the
      Company's Annual Report for the year ended April 30, 2005.
      The preparation of these unaudited consolidated financial statements
      requires management to make estimates and assumptions that affect the
      amounts reported in the consolidated financial statements and the
      accompanying notes. In the opinion of management, these unaudited
      consolidated financial statements reflect all adjustments (which include
      only normal, recurring adjustments) necessary to state fairly the results
      for the periods presented. Actual results could differ from these
      estimates and the operating results for the interim periods presented are
      not necessarily indicative of the results expected for the full year.
      2.  Revisions to comparative figures
      Discontinued operations
      On October 1, 2005, the Company sold substantially all the assets of
      its Interealty business, the business within Geac that provides Web-based
      MLS systems to realtors in North America, to First American Corporation.
      The assets and liabilities and the results of operations and cash flows
      for Interealty have been reported separately as discontinued operations
      in the consolidated balance sheet and the consolidated statements of
      earnings and cash flows. Comparative figures for the three and six months
      ended October 31, 2004 have been reclassified in order to conform to this
      presentation.
      Reclassification of investments
      The Company has adjusted its consolidated statements of cash flows for
      the six months ended October 31, 2004. In February 2005, the Company
      determined that its previously issued consolidated balance sheet as at
      April 30, 2004 required an adjustment to reclassify $26,500 of auction
      rate securities from cash and cash equivalents to short-term investments.
      The auction rate securities were classified as cash and cash equivalents
      as a result of the Company's intent to liquidate them within a 60-day
      period, however, the original maturities of the securities exceeded 90
      days. The adjustments to the Company's consolidated balance sheet as at
      April 30, 2004 resulted in a decrease of cash and cash equivalents of
      $26,500 and an increase in short-term investments of $26,500. In
      addition, adjustments to the Company's consolidated statement of cash
      flows resulted in an increase of $26,500 in cash from investing
      activities for the three months ended July 31, 2004 as a result of net
      sales of the auction rate securities. These reclassifications had no
      impact on the Company's results of operations.
      As of August 1, 2004 the Company no longer held any auction rate
      securities and ceased investing in these securities given that interest
      rates increased on traditional investment vehicles.
      3.  Changes in operating assets and liabilities from continuing
            operations
      Changes in operating assets and liabilities were as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Changes in operating                            (revised -                      (revised -
        assets and liabilities:                      see note 2)                    see note 2)
         Accounts receivable and
          other receivables          $  (1,831)  $    3,791    $    5,919    $  12,496
         Prepaid expenses and
          other assets                            858              165          2,829              306
         Accounts payable and
          accrued liabilities              5,050          1,628        (10,828)      (10,229)
         Accrued restructuring              (261)        (4,480)          (872)        (7,569)
         Employee future benefits         (374)          (571)        (2,379)          (406)
         Asset retirement obligation      (27)            131            (292)            160
         Income taxes payable            (3,617)          (479)        (2,482)            230
         Deferred revenue                 (21,290)      (21,912)      (26,464)      (36,773)
         Other                                        (329)            115            (270)            137
                                                ----------- ----------- ----------- -----------
      Total changes in operating
        assets and liabilities      $ (21,821)  $ (21,612)  $ (34,839)  $ (41,648)
                                                ----------- ----------- ----------- -----------
      4.  Goodwill
      The change in the carrying amount of goodwill is as follows:
      Goodwill balance, April 30, 2005                                                 $ 110,142
      Foreign exchange impact                                                                    (1,197)
                                                                                                         -----------
      Goodwill balance, July 31, 2005                                                      108,945
      Foreign exchange impact                                                                         310
                                                                                                         -----------
      Goodwill balance, October 31, 2005                                              $ 109,255
                                                                                                         -----------
                                                                                                         -----------
      5.  Employee future benefits
      The Company recorded employee future benefit expenses as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Defined contribution
        pension plans                    $        441    $        508    $        911    $    1,158
      Defined benefit pension
        plan                                            232              220              470              445
                                                ----------- ----------- ----------- -----------
                                                 $        673    $        728    $    1,381    $    1,603
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      6.  Asset retirement obligations
      The Company has obligations with respect to the retirement of leasehold
      improvements at maturity of facility leases and the restoration of
      facilities back to their original condition at the end of the lease term.
      The following table details the changes in the Company's leasehold
      retirement liability for the six months ended October 31, 2005:
      Asset retirement obligations balance, April 30, 2005                 $    1,678
         Additions to the obligations                                                                23
         Accretion charges                                                                                 24
         Payments                                                                                            (265)
         Amounts released due to settlements                                                  (88)
         Foreign exchange impact                                                                    (101)
                                                                                                         -----------
      Asset retirement obligations balance, July 31, 2005                         1,271
         Additions to the obligations                                                                98
         Accretion charges                                                                                 22
         Payments                                                                                              (27)
         Amounts released due to settlements                                                  (79)
         Foreign exchange impact                                                                      (64)
                                                                                                         -----------
      Asset retirement obligations balance, October 31, 2005              $    1,221
                                                                                                         -----------
                                                                                                         -----------
      7.  Net restructuring and other unusual items
      The expense (recovery) in net restructuring and other unusual items was
      comprised of the following:
                                                    Three months ended          Six months ended
                                                          October 31,                    October 31,
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Unusual items                      $    4,202    $          -    $    4,169    $          -
      Restructuring reversals                  -            (367)                -         (1,020)
                                                ----------- ----------- ----------- -----------
      Net restructuring and
        other unusual items          $    4,202    $      (367)  $    4,169    $  (1,020)
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Unusual items
      For the three months ended October 31, 2005, the Company recorded $4,202
      in unusual items. Of this amount, $1,692 relates to the costs associated
      with the termination of the Loan Agreement with Wells Fargo Foothill,
      Inc. (see note 8). The remaining balance of $2,510 are associated with
      the proxy contest relating to the election of the Board of Directors.
      For the six months ended October 31, 2005, the unusual items balance of
      $4,169 was substantially comprised of the aforementioned items.
      Restructuring expense
      For the three months ended October 31, 2004, the net restructuring credit
      balance of $367 was comprised of the release of previously accrued lease
      termination costs that are no longer required. For the six months ended
      October 31, 2004, the Company recorded a reversal of $1,020, as several
      smaller restructuring accruals relating to severance amounts and lease
      termination costs were released to adjust the accruals to match the
      current estimates of the amounts required.
      Restructuring accrual
      Activity related to the Company's restructuring plans, business
      rationalization, and integration actions, was as follows:
                                                              Premises        Workforce
                                                         restructuring  reductions          Total
                                                         ------------- ------------- -------------
      April 30, 2005 provision balance    $    4,265        $        538        $    4,803
         Additions to provision                              -                 248                 248
         Costs charged against provisions         (648)              (362)          (1,010)
         Provision release                                      -                 (13)                (13)
         Foreign exchange impact                         (38)                 (8)                (46)
                                                         ------------- ------------- -------------
      July 31, 2005 provision balance            3,579                 403              3,982
         Additions to provision                              -                 206                 206
         Costs charged against provisions         (570)              (477)          (1,047)
         Foreign exchange impact                          (7)                  3                  (4)
                                                         ------------- ------------- -------------
      October 31, 2005 provision
        balance                                          $    3,002        $        135              3,137
                                                         ------------- -------------
                                                         ------------- -------------
         Less: Current portion                                                                      2,239
                                                                                                      --------------
      Long-term portion of restructuring accrual                                 $        898
                                                                                                      -------------
                                                                                                      -------------
      During the three and six months ended October 31, 2005, the Company
      accrued $206 and $454, respectively, in severance related to the
      rationalization of the Company's North American business locations.
      Additionally, during the six months ended October 31, 2005 a severance
      accrual of $13 was released through operations to adjust the accrual to
      match the current estimates of the amounts required.
      As at October 31, 2005, a balance of $135 is remaining for severance, of
      which the remainder will substantially be paid by the third quarter of
      fiscal 2007 and will include severance relating to employees from the
      support and services, development and sales and marketing areas.
      The remaining balance for accrued premises restructuring was $3,002 as at
      October 31, 2005. Of this balance, the Company has a restructuring
      liability of approximately $196 related to the acquisition of Comshare.
      This remaining balance relates to lease termination costs and will be
      utilized through the first quarter of fiscal 2008. Additionally, a
      balance of $1,202 remains related to the acquisition of Extensity and is
      expected to be utilized through the second quarter of fiscal 2007. The
      remaining balance relates to the rationalization of the Company's North
      American and European business locations. The Company anticipates that
      the remainder of the balance will be utilized through fiscal 2025.
      8.  Credit facility
      On August 11, 2005 the Company and certain of its subsidiaries entered
      into a Credit Agreement (the "Credit Agreement") with a banking syndicate
      led by Bank of America, N.A., pursuant to which the Company and certain
      of its subsidiaries obtained a five-year, $150 million revolving credit
      facility (the "new Facility"). The annual interest rate payable on
      advances under the Facility is, at the Company's option, the prime rate
      plus 25 to 75 basis points, or LIBOR plus 125 to 175 basis points. The
      fee paid on the unused portion of the new Facility will range between 30
      and 45 basis points.
      The new Facility replaces the Company's previous $50 million, fully-
      secured credit facility with Wells Fargo Foothill, Inc. (the "prior
      Facility"). The new Facility is secured only by the common stock of
      certain of the Company's material subsidiaries and is available for
      working capital needs, acquisitions, and other general corporate purposes
      of the Company. As of October 31, 2005, none of the new Facility has been
      utilized. A balance of $150 million was available to the Company.
      Financing costs of $1,960 incurred to close the transaction were recorded
      as other assets in the second quarter of fiscal 2006 and are being
      amortized to interest expense on a straight-line basis over the term of
      the new Facility. Amortization costs related to this financing was $87 in
      the quarter ended October 31, 2005. As of October 31, 2005, the remaining
      unamortized financing costs were $1,873. For the six months ended
      October 31, 2005, interest expense included the amortization of financing
      costs of $236 related to the prior Facility and $87 related to the
      Company's new Facility. For the three and six months ended October 31,
      2004, amortization related to the financing costs on the prior Facility
      was $235 and $471, respectively.
      Upon termination of the prior Facility on August 11, 2005, the Company
      expensed to unusual items the remaining unamortized financing costs of
      $1,042, the termination penalty of $541 and closing costs of $109.
      The Company is subject to various customary financial covenants under the
      new Facility. The Company was in compliance with all such covenants as at
      October 31, 2005.
      9. Discontinued operations
      On October 1, 2005, the Company completed the sale of substantially all
      the assets of its Interealty business, the business within Geac that
      provides Web-based MLS systems to realtors in North America, to First
      American Corporation. The total consideration received was $36,293. The
      Company recorded a pre-tax gain of $33,704 ($21,270 net of income tax),
      recorded in discontinued operations on the consolidated statement of
      earnings.
      The assets and liabilities and the results of operations and cash flows
      for Interealty have been reported separately as discontinued operations
      in the consolidated balance sheet and the consolidated statements of
      earnings and cash flows. Comparative figures for the three and six months
      ended October 31, 2004 have been reclassified in order to conform to this
      presentation. The Interealty business was included in the Company's
      Industry Specific Applications segment for its segmented reporting.
      The results of discontinued operations presented in the consolidated
      statements of operations were as follows:
                                                            Three months ended    Six months ended
                                                                    October 31,              October 31,
                                                            ------------------- -------------------
                                                                 2005         2004         2005         2004
                                                            --------- --------- --------- ---------
      Revenue                                          $  4,564  $  5,956  $ 11,010  $ 11,824
      Cost of revenue                                  2,274        3,819        5,562        7,582
                                                            --------- --------- --------- ---------
      Gross profit                                  $  2,290  $  2,137  $  5,448  $  4,242
                                                            --------- --------- --------- ---------
                                                            --------- --------- --------- ---------
      Earnings from discontinued
        operations before income tax
        expense                                         $  1,237  $      909  $  2,964  $  1,579
      Income tax expense                                 426          272        1,030          491
                                                            --------- --------- --------- ---------
      Net earnings from discontinued
        operations                                            811          637        1,934        1,088
      Gain on divestiture, net of tax
        expense of $12,434                          21,270              -      21,270              -
                                                            --------- --------- --------- ---------
         Discontinued operations, net
          of income taxes                         $ 22,081  $      637  $ 23,204  $  1,088
                                                            --------- --------- --------- ---------
                                                            --------- --------- --------- ---------
      The consolidated balance sheets as at October 31, 2005 and April 30, 2005
      include Interealty balances. A summary of the assets and liabilities
      related to the Interealty business is as follows:
                                                                                              October    April
                                                                                            31, 2005  30, 2005
                                                                                            --------- ---------
      Current assets related to discontinued operations
         Cash                                                                            $      376  $      108
         Prepaid expenses and other assets                                         -          244
         Accounts receivable and other receivables                            -        1,745
                                                                                            --------- ---------
      Total current assets related to discontinued
        operations                                                                    $      376  $  2,097
                                                                                            --------- ---------
                                                                                            --------- ---------
      Long-term assets related to discontinued operations
         Property, plant, and equipment                                  $         -  $  1,123
         Other non-current assets                                                        -          111
         Future income taxes                                                                -        1,029
                                                                                            --------- ---------
      Total long-term assets related to discontinued
        operations                                                                    $         -  $  2,263
                                                                                            --------- ---------
                                                                                            --------- ---------
      Current liabilities related to discontinued
        operations
         Accounts payable and accrued liabilities                  $      376  $  1,845
         Deferred revenue                                                                    -        2,112
                                                                                            --------- ---------
      Total current liabilities related to discontinued
        operations                                                                    $      376  $  3,957
                                                                                            --------- ---------
                                                                                            --------- ---------
      10. Stock-based compensation
      The Company uses the fair value method of accounting to account for all
      stock-based compensation payments to employees granted subsequent to
      April 30, 2003. Prior to May 1, 2003, the Company accounted for its
      employee stock options and shares issued under the Employee Stock
      Purchase Plan ("ESPP") using the settlement method and no compensation
      expense was recognized.
      For awards granted during the year ended April 30, 2003, pro forma net
      earnings and earnings per share information is provided as if the Company
      had accounted for employee stock options under the fair value method. The
      pro forma effect of awards granted and shares issued prior to May 1, 2002
      has not been included in the pro forma net earnings and earnings per
      share information.
      The pro forma disclosure relating to options granted during fiscal 2003
      is as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Net earnings - as reported $  33,186    $  15,204    $  44,476    $  28,716
      Pro forma stock-based
        compensation expense,
        net of income taxes                    (76)            (70)          (147)          (252)
                                                ----------- ----------- ----------- -----------
      Net earnings - pro forma    $  33,110    $  15,134    $  44,329    $  28,464
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Basic net earnings per
        common share - as
        reported                            $      0.39    $      0.18    $      0.52    $      0.34
      Pro forma stock-based
        compensation expense per
        common share                                  -                 -                 -                 -
                                                ----------- ----------- ----------- -----------
      Basic net earnings per
        common share - pro forma  $      0.39    $      0.17    $      0.52    $      0.34
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        common share - as
        reported                            $      0.37    $      0.17    $      0.50    $      0.33
      Pro forma stock-based
        compensation expense per
        common share                                  -                 -                 -                 -
                                                ----------- ----------- ----------- -----------
         Diluted net earnings
          per common share -
          pro forma                        $      0.37    $      0.17    $      0.50    $      0.33
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      The assumptions used to calculate pro forma stock-based compensation were
      as follows:
      Assumptions - Stock Options
      Weighted average risk-free interest rate                                          4.54%
      Weighted average expected life (in years)                                            6.6
      Weighted average volatility in the market price of common
        shares                                                                                              75.81%
      Weighted average dividend yield                                                         0.00%
      Weighted average grant date fair values of options issued          $    2.09
      For the quarters ended October 31, 2005 and 2004, the Company expensed
      $979 and $986, respectively, relating to the fair value of stock options
      granted in fiscal 2004 and 2005. For the quarter ended October 31, 2005,
      the Company expensed $119 relating to the fair value of shares issued
      under the ESPP. No amount was expensed relating to the fair value of
      shares issued under the ESPP for the quarter ended October 31, 2004. For
      the six months ended October 31, 2005 and 2004, the Company expensed
      $1,901 and $1,636, respectively, relating to the fair value of stock
      options granted in fiscal 2004 and 2005 and $222 and $260, respectively,
      relating to the fair value of shares issued under the ESPP. Contributed
      surplus was credited $1,098 and $986 for these awards for the quarters
      ended October 31, 2005 and 2004, respectively. For the six months ended
      October 31, 2005 and 2004, contributed surplus was credited $2,123 and
      $1,896, respectively, for these awards. The remaining balance in
      contributed surplus will be reduced as the stock options are forfeited or
      exercised. Contributed surplus was reduced by $119 and $260 for the
      quarters ended October 31, 2005 and 2004, respectively, relating to
      shares issued under the ESPP. For the six months ended October 31, 2005
      and 2004, contributed surplus was reduced by $243 and $260, respectively,
      relating to shares issued under the ESPP.
      The estimated fair values of the stock options and shares issued under
      the ESPP are amortized to earnings over the vesting period on a straight-
      line basis and were determined using the Black Scholes option pricing
      model with the following weighted average assumptions:
                                                                                                 Three          Six
                                                                                                months      months
                                                                                                 ended        ended
                                                                                              October    October
                                                                                            31, 2004  31, 2004
                                                                                            --------- ---------
      Assumptions - Stock Options
      Weighted average risk free interest rate                          4.28%        4.33%
      Weighted average expected life (in years)                            7.0          7.0
      Weighted average volatility in the market price of
        common shares                                                                  65.14%      66.12%
      Weighted average dividend yield                                         0.00%        0.00%
      Weighted average grant date fair values of options
        issued                                                                                $4.38        $4.45
      No options were granted during the three and six months ended October 31,
      2005.
                                                                                 Three
                                                                                months
                                                                                 ended      Six months ended
                                                                         October 31,              October 31,
                                                                            --------- -------------------
      Assumptions - ESPP                                                2005         2005         2004
      ------------------                                         --------- --------- ---------
      Weighted average risk free interest rate            2.88%      2.84%        2.21%
      Weighted average expected life  (in months)          6.0         6.0          6.0
      Weighted average volatility in the market
        price of common shares                                      29.01%    23.11%      37.44%
      Weighted average dividend yield                          0.00%      0.00%        0.00%
      Weighted average grant date fair values of
        awards or shares issued                                      $3.14      $2.73        $2.69
      Directors' deferred share unit plan
      The Company also maintains a Directors' deferred share unit plan ("DSU").
      Under the plan, the Human Resources and Compensation Committee of the
      Board, or its designee, may grant deferred share units to members of the
      Company's Board of Directors as compensation for the services rendered to
      the Company as a Board member. As determined by the Company, units issued
      under the plan may be payable in cash or common stock. For the three and
      six months ended October 31, 2005, the Company had a recovery of $138 and
      $12, respectively, in general and administrative expense relating to the
      revaluation of the DSUs. For the three and six months ended October 31,
      2004, the Company expensed $32 and $224, respectively, to general and
      administrative expense relating to the DSUs. Accrued liabilities as at
      October 31, 2005 were debited $138 for these awards, and are adjusted
      each quarter based on the market value of the units which have vested
      under the plan.
      Restricted share unit plan
      In September 2004, the Board of Directors authorized a restricted share
      unit ("RSU") plan. Under the RSU plan, the Human Resources and
      Compensation Committee of the Board, or its designee, may grant
      restricted share units to employees of the Company as a bonus or similar
      payment in respect of services rendered to the Company. Units issued
      under the RSU plan are currently subject to vesting conditions as
      follows: 20% vest one year subsequent to the grant date, 30% vest two
      years subsequent to the grant date, and 50% vest three years subsequent
      to the grant date. Each vested restricted share unit gives the employee
      the right to receive one share of the Company's common stock. No
      additional RSUs were granted during the quarter ended October 31, 2005.
      As at October 31, 2005, 1,332,250 units were outstanding under the RSU
      plan.
      The common shares for which restricted share units may be exchanged are
      purchased on the open market by a trustee appointed and funded by the
      Company. As no common shares will be issued by the Company pursuant to
      the plan, the plan is non-dilutive to existing shareholders. Compensation
      expense related to the Company's restricted share unit plan was $1,881
      and $3,640, for the three and six months ended October 31, 2005,
      respectively. As of May 5, 2005, all of the common shares required for
      issuance under the RSU plan were funded through open market purchases of
      the Company's shares and are held in trust for the benefit of the RSU
      plan participants.
      11. Earnings per share
      The shares used in the computation of the company's basic and diluted net
      earnings per common share were as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Weighted average number of
        common shares used in
        computing basic net
        earnings per share ('000s)    85,574         85,521         85,300         85,251
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Weighted average number of
        common shares used in
        computing diluted net
        earnings per share ('000s)    89,424         87,398         89,191         87,372
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      12. Commitments and contingencies
      Customer indemnifications
      The Company has entered into license agreements with customers that
      include limited intellectual property indemnification clauses. The
      Company generally agrees to indemnify its customers against legal claims
      that its software products infringe certain third-party intellectual
      property rights. In the event of such a claim, the Company is generally
      obligated to defend its customer against the claim and either to settle
      the claim at the Company's expense or pay damages that the customer is
      legally required to pay to the third-party claimant. The Company has not
      made any significant indemnification payments and has not accrued any
      amounts in relation to these indemnification clauses.
      Litigation
      Activity related to the Company's legal accruals was as follows:
      April 30, 2005 provision balance                                                  $        96
         Foreign exchange impact                                                                        (8)
                                                                                                            ---------
      July 31, 2005 provision balance                                                              88
         Foreign exchange impact                                                                         -
                                                                                                            ---------
      October 31, 2005 provision balance                                                $        88
                                                                                                            ---------
                                                                                                            ---------
      Extensity, a subsidiary acquired by Geac in March 2003, is subject to a
      class action lawsuit, which alleges that Extensity, certain of its former
      officers and directors, and the underwriters of its initial public
      offering in January 2000 violated U.S. securities laws by not adequately
      disclosing the compensation paid to such underwriters. The class action
      lawsuit has been consolidated with a number of similar class action
      lawsuits brought against other issuers and underwriters involved in
      initial public offerings. The plaintiffs seek an unspecified amount of
      damages. The plaintiffs and issuer parties have entered into a settlement
      agreement to settle all claims, which will be funded by the issuers'
      insurers. The settlement is still subject to approval by the Court.
      In addition, Geac is subject to various other legal proceedings and
      claims in the ordinary course of business, arising out of disputes over
      contracts, alleged torts, intellectual property, real estate and employee
      relations, among other things. In the opinion of management, resolution
      of these matters is not reasonably expected to have a material adverse
      effect on Geac's financial position, results of operations or cash flows.
      However, a materially adverse outcome with respect to such matters may
      affect our future financial position, results of operations or cash
      flows.
      13. Segmented information
      The Company reports segmented information according to CICA 1701,
      "Segment Disclosures." This standard requires segmentation based on the
      way management organizes segments for monitoring performance.
      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) offer 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 construction, banking, hospitality and publishing 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.
                                    Three months ended                    Six months ended
                                      October 31, 2005                      October 31, 2005
                            ----------------------------- -----------------------------
                                 EAS          ISA         Total         EAS          ISA         Total
                            --------- --------- --------- --------- --------- ---------
      Revenue:
         Software      $ 16,328  $  2,538  $ 18,866  $ 27,445  $  4,326  $ 31,771
         Support and
          services        68,594      13,216      81,810    136,141      26,258    162,399
         Hardware          1,859          652        2,511        5,200        1,093        6,293
                            --------- --------- --------- --------- --------- ---------
      Total revenue $ 86,781  $ 16,406  $103,187  $168,786  $ 31,677  $200,463
                            --------- --------- --------- --------- --------- ---------
                            --------- --------- --------- --------- --------- ---------
      Segment
        contribution $ 23,292  $  3,352  $ 26,644  $ 38,909  $  2,539  $ 41,448
                                    Three months ended                    Six months ended
                                      October 31, 2004                      October 31, 2004
                            ----------------------------- -----------------------------
                                  (revised - see note 2)            (revised - see note 2)
                                 EAS          ISA         Total         EAS          ISA         Total
                            --------- --------- --------- --------- --------- ---------
      Revenue:
         Software      $ 12,167  $  2,795  $ 14,962  $ 25,475  $  4,888  $ 30,363
         Support and
          services        68,846      14,190      83,036    138,542      28,190    166,732
         Hardware          1,749          727        2,476        3,185        1,194        4,379
                            --------- --------- --------- --------- --------- ---------
      Total revenue $ 82,762  $ 17,712  $100,474  $167,202  $ 34,272  $201,474
                            --------- --------- --------- --------- --------- ---------
                            --------- --------- --------- --------- --------- ---------
      Segment
        contribution $ 22,129  $  3,607  $ 25,736  $ 45,051  $  6,113  $ 51,164
      For the three and six months ended October 31, 2004, certain general and
      administrative expenses have been reclassified from corporate expenses to
      EAS segment expenses to provide a more accurate portrayal of segment
      contribution. In addition, the ISA balances exclude the results of
      Interealty.
      The reconciliation of segment contribution to earnings from continuing
      operations before income taxes is as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
                                                                  (revised -                      (revised -
                                                                  see note 2)                    see note 2)
      Segment contribution          $  26,644    $  25,736    $  41,448    $  51,164
      Corporate expenses                  (5,076)      (4,292)         (3,320)        (8,251)
      Amortization of intangible
        assets                                    (2,050)        (2,290)        (4,344)        (4,536)
      Interest income, net                 1,698              306          2,872              420
      Other income, net                          26              722              605              244
      Net restructuring and other
        unusual items                         (4,202)            367         (4,169)         1,020
                                                ----------- ----------- ----------- -----------
      Earnings from continuing
        operations before income
        taxes                                 $  17,040    $  20,549    $  33,092    $  40,061
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Geographical information:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
                                                                  (revised -                      (revised -
                                                                  see note 2)                    see note 2)
      Revenue by geographic
        location:
         Americas                            $ 50,856      $ 47,866      $ 96,642      $ 96,862
         Europe                                  44,720         43,609         88,518         87,238
         Asia                                        7,611          8,999         15,303         17,344
                                                ----------- ----------- ----------- -----------
      Total revenue                        $103,187      $100,474      $200,463      $201,474
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      14. United States generally accepted accounting principles
      The consolidated financial statements of the Company have been prepared
      in accordance with Canadian GAAP; however the Company's accounting
      policies, as reflected in these consolidated financial statements, do not
      materially differ from U.S. GAAP except as follows:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
                                                                  (revised -                      (revised -
                                                                  see note 2)                    see note 2)
      Net earnings from
        continuing
        operations under
        Canadian GAAP
        - as reported                    $  11,105    $  14,567    $  21,272    $  27,628
      Adjustments:
         Stock-based
          compensation (a)                         -              (14)                -              (26)
         Write off and
        amortization of
          intellectual property
          capitalized under
          Canadian GAAP in
          connection with the
          Comshare acquisition (b)          75                75              150              150
         Income taxes (c)                        (30)            (30)            (60)            (60)
                                                ----------- ----------- ----------- -----------
      Net earnings from continuing
        operations under U.S. GAAP    11,150         14,598         21,362         27,692
      Discontinued operations,
        net of income taxes                22,081              637         23,204          1,088
                                                ----------- ----------- ----------- -----------
      Net earnings under U.S. GAAP  33,231         15,235         44,566         28,780
      Other comprehensive income:
      Foreign currency translation
        adjustment                                  (78)         2,530         (3,421)         3,008
                                                ----------- ----------- ----------- -----------
      Comprehensive income under
        U.S. GAAP                          $  33,153    $  17,765    $  41,145    $  31,788
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
         Net earnings per share
          from continuing
          operations under
          U.S. GAAP:
      Basic net earnings per
        common share                      $      0.13    $      0.17    $      0.25    $      0.32
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        common share                      $      0.12    $      0.17    $      0.24    $      0.32
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Net earnings per share from
        discontinued operations
        under U.S. GAAP:
      Basic net earnings per
        common share                      $      0.26    $      0.01    $      0.27    $      0.02
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        common share                      $      0.25    $          -    $      0.26    $      0.01
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Net earnings per share
        under U.S. GAAP:
      Basic net earnings per
        common share                      $      0.39    $      0.18    $      0.52    $      0.34
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        common share                      $      0.37    $      0.17    $      0.50    $      0.33
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Weighted average number of
        common shares used in
        computing basic net
        earnings per share
        ('000s)                                  85,574         85,521         85,300         85,251
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Weighted average number of
        common shares used in
        computing diluted net
        earnings per share ('000s)  89,424          87,398         89,191         87,372
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Stock-based compensation
      a)  Accounting for stock options
            In fiscal 2004, the Company prospectively adopted the new Canadian
            GAAP recommendations, which require that a fair value method of
            accounting be applied to all stock based compensation awards granted
            on or after May 1, 2003 to both employees and non-employees. The
            Canadian GAAP recommendations are substantially harmonized with the
            existing U.S. GAAP rules, which have also been adopted by the Company
            prospectively for all awards granted on or after May 1, 2003.
            Therefore, no GAAP difference exists for stock based compensation and
            awards granted in fiscal 2004 and thereafter.
            In fiscal 2003 and prior periods, the Company did not recognize any
            stock-based compensation cost under Canadian GAAP. For U.S. GAAP, the
            Company elected to measure stock-based compensation cost based on the
            difference, if any, on the date of the grant, between the market
            value of the shares and the exercise price (referred to as the
            "intrinsic value method") over the vesting period.
            Pro forma disclosures
            For awards granted prior to May 1, 2003, U.S. GAAP requires the
            disclosure of pro forma net earnings and earnings per share
            information for all outstanding awards as if the Company had
            accounted for employee stock options under the fair value method.
            The following table presents net earnings and earnings per share
            information following U.S. GAAP for purposes of pro forma
            disclosures:
                                                    Three months ended          Six months ended
                                                          October 31                      October 31
                                                ----------------------- -----------------------
                                                      2005            2004            2005            2004
                                                ----------- ----------- ----------- -----------
      Net earnings under U.S.
        GAAP - as reported above  $  33,231    $  15,235    $  44,566    $  28,780
      Pro forma stock-based
        compensation expense,
        net of tax                                 (234)          (218)          (476)          (570)
                                                ----------- ----------- ----------- -----------
      Net earnings - pro forma      $  32,997    $  15,017    $  44,090  $  28,210
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Basic net earnings per
        common share under
        U.S. GAAP - as
        reported above                  $      0.39    $      0.18    $      0.52    $      0.34
      Pro forma stock-based
        compensation expense per
        common share                                  -                 -                 -          (0.01)
                                                ----------- ----------- ----------- -----------
      Basic net earnings per
        common share - pro forma  $      0.39    $      0.18    $      0.52    $      0.33
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        share under U.S. GAAP -
        as reported above              $      0.37    $      0.17    $      0.50    $      0.33
      Pro forma stock-based
        compensation expense per
        common share                                  -                 -          (0.01)         (0.01)
                                                ----------- ----------- ----------- -----------
      Diluted net earnings per
        common share - pro forma  $      0.37    $      0.17    $      0.49    $      0.32
                                                ----------- ----------- ----------- -----------
                                                ----------- ----------- ----------- -----------
            Fair values
            The fair values of awards granted were estimated using the Black-
            Scholes option-pricing model. The Black-Scholes model was developed
            to estimate the fair value of traded options and awards, which have
            no vesting restrictions, and are fully transferable. The Black-
            Scholes model requires the input of highly subjective assumptions
            including the expected stock price volatility and expected time until
            exercise. Because the Company's employee stock options and stock
            awards have characteristics significantly different from those of
            traded options and awards, and because changes in the subjective
            input assumptions can materially affect the fair value estimate, in
            management's opinion, existing models, including the Black-Scholes
            model, do not necessarily provide a reliable single measure of the
            fair value of its employee stock options and stock awards.
      b)  Intangible assets
            In-process research and development
            In connection with the acquisition of Comshare, in-process research
            and development was acquired and capitalized under Canadian GAAP.
            Under U.S. GAAP, such in-process research and development is charged
            to expense at the acquisition date. As a result, under U.S. GAAP, the
            carrying value of the Company's intangible assets on the consolidated
            balance sheet would be $18,380 (April 30, 2005 - $22,833) and the
            value of the Company's long-term future income tax assets would be
            $20,512 (April 30, 2005 - $34,961).
            Goodwill
            Although the new Canadian GAAP section for Income Taxes is
            substantially harmonized with U.S. GAAP, it was applied retroactively
            and goodwill was not adjusted, resulting in differing carrying values
            of goodwill under Canadian and U.S. GAAP. Under U.S. GAAP, the
            carrying value of goodwill on the consolidated balance sheet would be
            $92,062 (April 30, 2005 - $92,835).
      c)  Income taxes
            Included in "Income taxes" is the income tax effect of the adjustment
            related to amortization of in-process research and development.
      15. Recent accounting pronouncements
      Canadian GAAP
      Financial Instruments, Comprehensive Income, Hedges
      On January 27, 2005, the Accounting Standards Board issued Canadian
      Institute of Chartered Accountants ("CICA") handbook section 1530
      Comprehensive Income ("Section 1530"), handbook Section 3855 Financial
      Instruments - Recognition and Measurement ("Section 3855") and handbook
      section 3865 Hedges ("Section 3865"). Section 3855 expands on CICA
      handbook section 3860 Financial Instruments - Disclosure and Presentation
      by prescribing when a financial instrument is to be recognized on the
      balance sheet and at what amount. It also specifies how instrument gains
      and losses are to be presented. Section 3865, Hedges, is optional. It
      provides alternative treatments to Section 3855 for entities that choose
      to designate qualifying transactions as hedges for accounting purposes
      and specifies how hedge accounting is applied and what disclosures are
      necessary when it is applied. Section 1530 introduced a new requirement
      to temporarily present certain gains and losses outside net income in a
      new component of shareholders' equity entitled Comprehensive Income.
      These standards are substantially harmonized with U.S. GAAP and are
      effective for the Company beginning May 1, 2007. The Company is currently
      evaluating the impact of these standards on its consolidated financial
      position, results of operations and cash flows.
      U.S. GAAP
      Share-Based Payment
      In December 2004, the Financial Accounting Standards Board ("FASB")
      issued Statement of Financial Accounting Standards ("SFAS") No. 123
      (revised 2004), "Share-Based Payment" ("SFAS 123R"), which replaces SFAS
      No. 123, "Accounting for Stock-Based Compensation," ("SFAS 123") and
      supersedes APB Opinion No. 25, "Accounting for Stock Issued to
      Employees". SFAS 123R requires all share-based payments to employees,
      including grants of employee stock options, to be recognized in the
      financial statements based on their fair values beginning with the first
      interim or annual period after June 15, 2005, with early adoption
      encouraged. In April 2005, the Securities and Exchange Commission (the
      "SEC") postponed the effective date of SFAS 123R until the issuer's first
      fiscal year beginning after June 15, 2005. Under the current rules, the
      Company will be required to adopt SFAS 123R in the first quarter of
      fiscal 2007, beginning May 1, 2006. The pro forma disclosures previously
      permitted under SFAS 123 no longer will be an alternative to financial
      statement recognition.
      The Company adopted the fair value method of accounting for all stock-
      based compensation awards to both employees and non-employees granted on
      or after May 1, 2003. All stock-based compensation related to awards
      granted prior to April 30, 2003 is included in the pro forma disclosures
      above. Under SFAS 123R, the Company must utilize one of the transition
      methods required by the standard to record the fair value of stock-based
      compensation related to these awards. The transition methods include
      prospective and retroactive adoption options. Under the retroactive
      option, prior periods may be restated either as of the beginning of the
      year of adoption or for all periods presented. The prospective method
      requires that compensation expense be recorded for all unvested stock
      options and restricted stock at the beginning of the first quarter of
      adoption of SFAS 123R, while the retroactive methods would record
      compensation expense for all unvested stock options and restricted stock
      beginning with the first period restated.
      In March 2005, the SEC issued Staff Accounting Bulletin No. 107
      ("SAB 107") regarding the SEC's interpretation of SFAS 123R and the
      valuation of share-based payments for public companies. The Company is
      evaluating the requirements of SFAS 123R and SAB 107 and expects that the
      adoption of SFAS 123R on May 1, 2006 will not have a material impact on
      its consolidated results of operations and earnings per share. The
      Company has not yet determined the method of adoption or the effect of
      adopting SFAS 123R, and it has not determined whether the adoption will
      result in amounts that are similar to the current pro forma disclosures
      under SFAS 123.
      Exchanges of Non-monetary Assets
      In December 2004, the FASB issued SFAS No. 153, "Exchanges of
      Non-monetary Assets - An Amendment of Accounting Principles Board Opinion
      No. 29, Accounting for Non-monetary Transactions" ("SFAS 153"). SFAS 153
      eliminates the exception from fair value measurement for non-monetary
      exchanges of similar productive assets in paragraph 21(b) of APB Opinion
      No. 29, "Accounting for Non-monetary Transactions," and replaces it with
      an exception for exchanges that do not have commercial substance.
      SFAS 153 specifies that a non-monetary exchange has commercial substance
      if the future cash flows of the entity are expected to change
      significantly as a result of the exchange. SFAS 153 is effective for
      fiscal periods beginning after June 15, 2005 and was adopted by the
      Company in the second quarter of fiscal 2006, beginning on August 1,
      2005. The adoption of Statement 153 had no effect on its consolidated
      financial position, results of operations or cash flows.
      Accounting Changes and Error Corrections
      On June 7, 2005, the FASB issued Statement No. 154, Accounting Changes
      and Error Corrections, a replacement of APB Opinion No. 20, Accounting
      Changes, and Statement No. 3, Reporting Accounting Changes in Interim
      Financial Statements. Statement 154 changes the requirements for the
      accounting for and reporting of a change in accounting principle.
      Previously, most voluntary changes in accounting principles required
      recognition of a cumulative effect adjustment within net income of the
      period of the change. Statement 154 requires retrospective application to
      prior periods' financial statements, unless it is impracticable to
      determine either the period-specific effects or the cumulative effect of
      the change. Statement 154 is effective for accounting changes made in
      fiscal years beginning after December 15, 2005; however, the Statement
      does not change the transition provisions of any existing accounting
      pronouncements. We do not believe adoption of Statement 154 will have a
      material effect on our consolidated financial position, results of
      operations or cash flows.
      Amortization Period for Leasehold Improvements
      On June 29, 2005, the FASB ratified the EITF's Issue No. 05-06,
      Determining the Amortization Period for Leasehold Improvements.
      Issue 05-06 provides that the amortization period used for leasehold
      improvements acquired in a business combination or purchased after the
      inception of a lease be the shorter of (a) the useful life of the assets
      or (b) a term that includes required lease periods and renewals that are
      reasonably assured upon the acquisition or the purchase. The provisions
      of Issue 05-06 are effective on a prospective basis for leasehold
      improvements purchased or acquired in reporting periods beginning after
      board ratification (June 29, 2005). We do not believe the adoption of
      Issue 05-06 will have a material effect on our consolidated financial
      position, results of operations or cash flows.
      16. Subsequent event
      On November 7, 2005, the Company announced that it reached a definitive
      agreement ("the Agreement") with Golden Gate Capital, for Golden Gate
      Capital to acquire Geac in an all-cash transaction valued at $11.10 per
      share, or approximately $1.0 billion, pursuant to a plan of arrangement.
      Both parties anticipate closing the transaction in the first calendar
      quarter of 2006. The closing is subject to certain customary closing
      conditions, including receipt of required regulatory approvals and Geac
      shareholder and court approval of the plan of arrangement.
      Under terms specified in the Agreement, Geac or Golden Gate Capital may
      terminate the Agreement, and as a result either Geac or Golden Gate
      Capital will be required to pay a $25 million termination fee to the
      other party. Either Geac or Golden Gate Capital may terminate the
      Agreement if the acquisition has not closed by March 16, 2006, as long as
      the terminating party has not caused the delay in closing by not
      complying with a term of the Agreement.
      17. Reclassification of comparative figures
      Certain prior year's comparative figures in the accompanying interim
      financial statements have been reclassified to conform to the current
      year's presentation.@@end@@

ots Originaltext: Geac Computer Corporation Limited.
Im Internet recherchierbar: http://www.presseportal.ch



Weitere Meldungen: Geac Computer Corporation Limited.

Das könnte Sie auch interessieren: