Streamlining pays off for Geac in NZ

By ADAM GIFFORD

Geac's New Zealand operation is bouncing back from the scaling back of plans for its StreamLine enterprise management software.

Earlier this year, the company decided to drop plans to widen the software to cater for the North American market.

It has since bought the local government division of Australian company Praxa, whose staff will take over space in Geac's Grafton Rd offices freed up by redundant StreamLine developers.

Half of the 68 StreamLine staff employed in Auckland and five in Sydney were made redundant in May, but given a a bonus payment to stay to July 28 to help finish release 3.1 of Streamline, which is due out by mid-August.

Five have since been redeployed, 25 found jobs, four are heading overseas and five are unemployed.

The decision to concentrate development of StreamLine, a Windows NT-based client server system aimed at manufacturing and distribution companies, on the business needs of the Asia-Pacific region does not seem to have affected sales.

Graeme Riley, Geac's Asia-Pacific managing director, said there had been two sales in the past fortnight, to Hamilton truck parts distributor and trailer manufacturer Tidd Ross Todd and to an Auckland company servicing the wine industry.

"We've just appointed a StreamLine distributor in Malaysia, and we're starting to see activity in the Australian market," Mr Riley said.

Although there is no StreamLine sales force in Europe, Mr Riley said sales were in the pipeline.

StreamLine falls within the Geac Enterprise Solutions division, along with the British-made System 21 product, SmartStream (which grew from the Dunn & Bradstreet financial software), RunTime, a customer relationship management system which is strong in apparel companies, and other products.

In its acquisitions, Geac sees companies' main assets as their customers rather than their products.

Mr Riley said Praxa's GEMS (Government Enterprise Management System) software had a solid base of New Zealand customers, but it would have taken considerable work to modify it for Australia.

Geac acquired an Australian local government system, Pathway, a couple of years ago, and Mr Riley said it was unlikely the two products would be merged. "Local government software around the world is driven by statutory requirements, so it's almost impossible to be a global player," he said.

"Pathway has all the Australian bits, so we now have a very good story both sides of the Tasman."

Praxa chief operating officer George Sutherland said his company's core business was large-scale systems integration. The local government division grew out of its acquisition of Catalyst Systems, which developed GEMS.

"We looked where the business was going, discussed it with Geac and felt there needed to be a consolidation of suppliers in the marketplace," Mr Sutherland said.

As well as GEMS, Geac will get customers still using LGIS, (Local Government Information System), an older "green screen" product.

"It's bulletproof but people want the graphical user interface and the input to relational databases you get with newer products like GEMS," said Mr Sutherland.

He said council amalgamations meant there were fewer but bigger customers.

Mr Riley said that was good for Geac, whose products suited the middle and upper end of the market.

Its main competition is Sanderson, while systems from Fujitsu and Napier Computer Systems (NCS), popular with smaller councils, are being squeezed out.

Worldwide, Geac's end-of-year results announced last month showed sales for the year grew 26.5 per cent to $C990.1 million. Net income was $49.1 million, compared to a $111.6 million loss the previous year.

The company sold its banking systems business for $160 million to European venture capital firm 3i Group, which also recently bought Motherwell Information Systems.

Chief executive Doug Bergeron said Geac's stronger balance sheet would allow it to pursue further acquisitions.