I had the chance to catch up with Thomas Kelly, the new chief executive of Irvine’s Epicor Software Corp.
Epicor, a maker of business software, weathered a handful of one-time events that made for a tough first quarter.
The company posted quarterly sales of $102 million, basically flat with $101 million a year earlier.
Including charges for stock compensation, acquisitions, research and development and other costs, Epicor swung to a loss of $7 million, versus a profit of $4.4 million in the first quarter of 2007.
Excluding the charges, Epicor would have made $4 million in profits, versus $9 million a year earlier and a bit better than analysts’ expected $3.5 million.
Epicor’s losses are partially due to a delayed product launch for its business selling software to retailers.
“I think we have one chance to get these things right,so we took a little extra time,” Kelly said. “Long term is what we care about. In the end, we think we’ve got it right.”
Although Kelly didn’t provide details, Epicor appears to have gotten squeezed by one of its customers on consulting work and ended up doing more work for less money.
It also saw a drop in revenue from software licenses and consulting work.
Kelly is eyeing a rebound.
“The first quarter had three distinct conditions that hit us at the same time and their combination caused some business to slide,” he said. “But we think those are all fully recoverable in the second quarter.”
Kelly, 55, has been working to take the reins from longtime Epicor head George Klaus, who ran the company since 1996.
Klaus is now executive chairman and is helping oversee the transition.
“I am absolutely up and running on my own right now but still rely upon George’s guidance,” he said.
Epicor hasn’t filled the president and chief operating officer job that was left when Mark Duffell left at the end of March to pursue outside opportunities. Duffell had been at Epicor for a dozen years.
“I have flattened out the reporting structure a bit,” Kelly said. “We don’t have a COO role right now and I like it that way. It’s kind of accelerated my integration.”
Scottish Humor
Jim McCluney, chief executive of Costa Mesa’s Emulex Corp., gave an interesting explanation for his reserved style in a speech last month before the local arm of the American Electronics Association.
McCluney, a native of Scotland, was named Outstanding Public Company Chief Executive by the group in a ceremony at the Irvine Hyatt.
Here’s what he said:
“Scottish people aren’t particularly loquacious, with the exception of four things,scotch, golf, soccer and the English.”
He got a big laugh from the black-tie crowd.
Other nominees for the award included Epicor’s George Klaus and John Coyne, chief executive of Lake Forest’s Western Digital Corp.
M-Flex Taps Directors
Anaheim’s Multi-Fineline Electronix Inc., a maker of flexible circuit boards for cell phones, named two more directors to its board.
The company, known as M-Flex, added Reza Meshgin and Donald Schwanz as directors, for a total of nine on the board.
Meshgin was recently appointed M-Flex’s chief executive as part of a planned succession.
He took over in March from longtime leader and Chairman Phil Harding, who had served as chief executive since 1988.
The company needed to expand the size of the board to maintain a majority of independent directors, according to Harding.
In a separate announcement, M-Flex said it hired Matthew Wolk as vice president of corporate development and chief strategy officer.
Wolk previously was managing partner of Invigorate Management Consulting LLC.
He currently is a mentor in the master’s of business administration program at the Paul Merage School of Business at the University of California, Irvine.
Fire Sale on Jadeon
Jadeon Inc., an Irvine-based reseller of software for stores, hotels and restaurants, was bought by a larger competitor last month.
Atlanta-based Radiant Systems Inc. bought Jadeon for $7 million from a unit of Innuity Inc., which is traded on the low-profile over-the-counter exchange.
Innuity, which lost about $3 million in 2007, sold Jadeon in a bit of a fire sale to recoup some of its losses.
Jadeon had been selling software to Radiant Systems since 2001, said Paul Langenbahn, hospitality division president.
Jadeon’s some 100 local workers are set to stay on as Radiant Systems employees.
Radiant Systems, which installs and services credit card scanning terminals and cash-register software, had a recent market value of about $440 million.
It counts Burger King, Dunkin’ Donuts, Red Robin and P.F. Chang’s China Bistro among its customers.
