September 14, 2000 -- Ross Systems Inc., a maker of supply chain management software, eliminated about 24 percent of its work force --- 125 positions --- in a restructuring move aimed to boost revenue and cut costs.
Shares fell 6 cents to $1.03 in Nasdaq trading Wednesday, bringing the stock close to its 52-week low of 91 cents.
For the year, the Atlanta-based company's shares are down more than 63 percent. Its shares reached a 52-week high of $3.81 in January.
The 28-year-old company expects the job cuts, which include 40 positions from its headquarters, will save $12 million a year.
"These changes are designed to lower our break-even point and increase profitability," said Robert Webster, chief financial officer at Ross.
The restructuring announcement was made late Tuesday after the markets closed.
Job cuts will occur in administration, sales and marketing, consulting and product development, the company said.
Charles Rinaldi, fund manager of the Strong Small Cap Value Fund, which purchased 144,000 Ross shares about a year ago, said that the sector has been in trouble for about a year.
"This whole software area has really been in a slowdown," Rinaldi said. Companies that would use management software products were busy with Y2K concerns, he said. Investors expected a bounce-back once those fears went away. But companies are now looking for Web-based management software, Rinaldi said.
Webster said some of the money Ross expects to save from the restructuring will go to developing more Internet-based products.
Companies want Web-based products because installation and upgrades are easier, and they lessen the need for technical support, he said.
"We have a changing technology world, and we're changing to some extent to pick up Internet-based products," Webster said.
Source: The Atlanta Journal-Constitution