Geac Parent Prunes for Future Profits
Rosenberg, Jim, Editor & Publisher
Florida unit has yet to feel impact of corporate restructuring
Concerned with profits and shareholder value, Geac Computer Corp. Ltd. is restructuring and reducing its work force. Meanwhile, with little direct influence on the fate of a parent that may be sold, attention at Geac's Publishing Systems division remains directed at selling systems that deliver value to newspaper customers.
"We have not seen the licensing generated by the sales force that's up to what we budgeted or expected" for the past two years, former Chairman and CEO William G. Nelson said last fall while serving as
interim head of the diversified computer software and services firm based in Markham, Ontario. "Particularly in newspapers, we have a significant pipeline, but the closes aren't there yet," he added, attributing the situation to what seemed to be a lengthening sales cycle -- "a conclusion" he said could change if there were no pick-up in sales by the year's end.
But through March, no new conclusions were announced following completion of a 20-week-long restructuring analysis undertaken in cooperation with financial advisers. Of the impact on Geac Publishing Systems, Investor Relations Vice President Michel GElinas would "not comment on a lower level" than the ongoing effort to improve profitability and maximize shareholder value. The Publishing Systems unit reported no cuts.
After announcing third-quarter results this month, Nelson's successor, John E. Caldwell, said he was "not in a position to comment further ... at this time" on the review of strategic alternatives. "This process is taking longer than originally anticipated," he said, adding that he expected to provide an update this spring.
Before making his remarks last October, "Nelson never actually shared this insight with me," said Publishing Systems President Bernard Grinberg. "I'm not told what happens at that level." In the larger perspective, he commented that "as the price of the stock hasn't risen a lot, I think that the company is still vulnerable to takeover. I think it's trading below its value."
Of his own division, Grinberg said he thinks "we've improved the business" in a climate of "fierce competition" during a time of steep price cutting. "It's tough. We have to be careful. We're not growing." He added that the division has seen no significant personnel changes and nothing related to restructuring.
In the last years of proprietary publishing systems, chemical companies, notably DuPont, got into the newspaper systems business -- with little success. Today, large software firms are trying their hand at it. Well before last year's acquisition of longtime U.S. suppliers System Integrators Inc. and CText by Germany's net-linx, venerable vendors of newspaper systems Collier-Jackson (U.S., business applications) and Cybergraphic (Australia, editorial and advertising production systems) were bought up by Canada's Geac Computer Corp., rolled into a publishing systems division at Collier-Jackson's old headquarters in Tampa, Fla., and joined by Matrix (U.K., circulation- distribution software) as well as Gazette Technologies (U.S., data warehousing).
Grinberg was a Cybergraphic founder who spent much time in recent years running the company's business in North America, a market that last year seemed to drift into the doldrums. The division did find its first U.S. circulation customer, Tupelo's Northeast Mississippi Daily Journal, which bought Matrix Single Copy and Direct Subscriber modules for 30 users.
Geac Publishing Systems continues to lock up Cybergraphic's home market.
The New Zealand Herald, a user of Atex's much-esteemed Enterprise ad system and killed-before-marketed Deadline newsroom system, has begun replacing the former with Geac Cla$$Page. The Wilson & Horton Ltd. flagship is possibly the first site to replace Enterprise. (In North America, Geac lost its own ad system customer to Sweden's Mactive, when the Milwaukee Journal Sentinel decided not to upgrade its Cybergraphic system. …