Good afternoon, and welcome to American Software's Third Quarter Fiscal 2012 Earnings Conference Call. To begin, I'd like to remind you that this conference call may contain forward-looking statements, including statements regarding, among other things, our business strategy and growth strategy.

Any such forward-looking statements speak only as of this date. These forward-looking statements are based largely on our expectations and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond our control.

Future developments and actual results could differ materially from those set forth in, contemplated by or underlying the forward-looking statements.

There are a number of factors that could cause actual results to differ materially from those anticipated by statements made on this call. Such factors include, but are not limited to, changes and uncertainty in general economic conditions, the growth rate of the market for our products and services, the timely availability and market acceptance of these products and services, the effect of competitive products and pricing and other competitive pressures and the irregular and unpredictable pattern of revenues.

In light of these risks and uncertainties, there can be no assurance that the forward-looking information will prove to be accurate.

At this time, I'd like to turn the call over to Mike Edenfield, CEO of Logility and COO of American Software.

Thanks, Vince. And good afternoon, everyone, and thanks for participating on the call.

I have some comments on the fiscal 2012 third quarter results. Vince will review the details on the financial results for the quarter, and then we'll take your questions.

First, excellent response to the release of the latest version of Demand Solutions product suite, DSX; secondly, the ongoing expansion of the indirect sales channel; and thirdly, our growing relationship with Microsoft.

Maintenance revenue, which is a recurring revenue stream, increased 11%, and services revenues increased 18% compared to last year's third quarter, with most of the increase coming from higher margin implementation services from Logility. Altogether, revenue increased 25%, which drove a 84% increase in operation -- operating earnings compared to the third quarter last year.

Over the last 4 quarters, we have increased operating income 120% compared to the same quarters the previous years.

We had 24 new customers sign license agreements in the third quarter. Customers from 10 different countries signed those license agreements.

Those countries included Australia, Canada, Colombia, France, Japan, New Zealand, Singapore, Sweden, the United Kingdom and the United States. Some notable and new existing customers include 3M New Zealand; A.R.T.

Furniture; GTM Sportswear; Haddad Apparel Group; Lighting Sciences Group; New Belgium Brewing; Newfoundland Labrador Liquor Control Board; Nicole Miller; Norgine; OneMed; Smith Cooper; Seagate; Sunovion Pharmaceuticals; and Victoria Classics. We continue to be encouraged by the number of new customers licensing our products as new customers are a source of future recurring maintenance revenue, new implementation services revenue, as well as being excellent prospects for additional product sales.

So as we look at the fourth quarter and the remainder of fiscal '12, our product line remains strong, there's robust interest from our customer base as well as new potential customers, we have good activity across all product lines and our pipeline continues to grow. We do have a tough comparison as last year's fourth quarter was by far our best quarter at some time.

The company does have a pipeline to grow the license fees in the fourth quarter on a year-over-year basis, but we must execute and close well to do so.

I would now like to turn the call back over to Vince for our detailed review of the third quarter and year-to-date financial results.

Thanks, Mike. First, I'd like to take a look at the third quarter fiscal '12 compared to the same period last year.

As Mike indicated, total revenues for the quarter increased 25% to $25.4 million, compared to $20.4 million last year. This is primarily due to license fee increase of 62% to $6.8 million compared to $4.2 million the same period last year.

Services and other revenues increased 18% to $10.3 million for the current quarter, that compares to $8.7 million. That's primarily due to services revenue increases at Logility, which was up 47%, and 14% at our IT Consulting unit.

Maintenance revenues increased 11% to $8.3 million compared to $7.5 million, and this is primarily due to increases in license fees.

Taking a look at costs, our overall gross margin increased to 53% for the current quarter compared to 51% the same quarter last year. Our license fee margin was up to 80% -- excuse me, 68% compared to 62% last year, and this is primarily due to increase in license fees.

Services margins decreased to 23% compared to 24% in the same period last year. That's primarily due to increases in staff hiring at Logility from increased demand of implementation work.

Maintenance margin increased to 77% for the current quarter compared to 76% in the same quarter last year, and that's primarily due to higher maintenance revenue.

Looking at operating expenses, our gross R&D expenses were 11% of total revenues for the current quarter, and that compares to 12% in the prior year. As a percentage of revenue, sales and marketing expenses were 18% for both the current and prior year quarter.

G&A expenses were 14% of total revenues for both the current and prior year quarter. So operating income increased 84% to $3.3 million this quarter compared to $1.8 million the same quarter a year ago.

Adjusted EBITDA, which excludes stock-based compensation, increased 50% to $4.7 million for this quarter, compares to $3.1 million in the same period last year. GAAP net income increased 47% to $2.6 million or earnings per diluted share of $0.10 for the quarter, and that compares to net income of $1.8 million or $0.07 per diluted share last year.

Adjusted net income increased 41% to $2.9 million or adjusted earnings per diluted share of $0.11 for the third quarter, and that compares to net income of $2.1 million or adjusted earnings per diluted share of $0.08 for the same period last year. The adjusted numbers, they exclude amortization of intangible expenses related to acquisitions and stock-based compensation expense.

International revenues for this quarter were approximately 17% of total revenues, and that compares to 15% the same period last year.

Comparing year-to-date, the 9 months ended January 31, 2012, from the same period last year, total revenues increased 24% to $74.7 million compared to $60.4 million. That's primarily due to license fees, which increased 82% to $20.5 million compared to $11.3 million the same period last year.

Services revenues also increased 10% to $30.1 million year-to-date compared to $27.4 million last year, and maintenance revenues also increased 11% to $24.1 million compared to $21.7 million last year.

Looking at cost, our overall gross margin was 55% year-to-date compared to 52% the same period last year. Our license fee margin increased to 73% from 67%, and that's primarily due to higher license fees.

Services margins were 26% compared to 28% year-to-date, and then that's probably due to staff hiring at Logility from increased demand of services work. Our maintenance margins were 77% year-to-date compared to 76% in the same period last year.

And again, that's up 1 point primarily due to higher maintenance revenue.

Looking at operating expenses, gross R&D expenses were 11% of total revenues for the 9-month period ended January 31, 2012, and that compares to 12% for the same period last year. As a percent of total revenue, sales and marketing expenses were 18% for both the current and same period last year, and G&A expenses were down to 13% of revenues compared to 15% in the same period last year.

So operating income year-to-date increased 108% to $11.6 million when compared to operating income of $5.6 million. Adjusted EBITDA year-to-date increased 79% to $15.8 million compared to $8.8 million the same period last year.

Excuse me. Our GAAP net income increased 71% to $7.9 million year-to-date compared to -- or $0.29 earnings per diluted share, and that compares to net income of $4.6 million or $0.18 per diluted share last year.

Adjusted net income year-to-date was $8.7 million or earnings per diluted share of $0.32, and that compares to net income of $5.7 million or earnings per diluted share of $0.22 for the same period last year. Year-to-date -- excuse me, international revenues year-to-date were approximately 16% of total revenues, and that compares -- that's up from 14% for the same period last year.

Looking at our balance sheet. Our cash and long-term investments are approximately $61.5 million at the end of January 31, 2012, and no debt.

The cash increased sequentially $7.3 million compared to October 31, 2011, and $9.1 million when compared to January 31, 2011.

Other aspects of the balance sheet are bills receivable of $14.6 million. Our unbilled is $4.3 million for a total of $18.9 million of receivables.

Our deferred revenue is $17.8 million and our shareholder equity is close to $80 million. Our current ratio is 2.6% as of the end -- for January 31, 2012, and that compares to 2.5% last year at this time.

Day sales outstanding as of January 31, 2012, was 68 days, and that's compared to 60 days for the same period last -- same time last year, and a decrease from 73 days as of -- sequentially at the end of October quarter.

At this time, I'd like to turn the call over to questions.

Mike, could you just tell us how many inventory optimization deals you closed in the quarter?

We did close some business in inventory optimization, but we're not going to be breaking out by product how many deals we do.

Okay. Let's see.

You mentioned that you got 24 new customers in the quarter, and I know that's up sequentially by quite a bit. Can you tell us how many customers you got, new customers you got in the year-ago quarter?

Year-ago quarter, I believe we did 28. But our average selling price is going up.

Okay, got it. And just kind of checking in on the progress you're making, expanding the VAR channel.

Can you tell us where you are there? Are you still on track to hit that kind of 58 number by the end of fiscal '12 here?

Yes, we are.

Okay, great. And I know you guys don't talk much about this, but could you give us some color about the Microsoft relationship?

Yes, I can. We've had the relationship, we're probably in about our fourth year of the relationship, and it took us a good while to get it going.

And just some metrics, we've closed 50% more business through that relationship year-to-date than we did all of last year. So we've got essentially a quarter remaining to build on that.

And the pipeline metrics are really the same. We got about 50% more pipeline now than we did at the end of the last fiscal year.

And so we're pleased with it. They're doing well with their Microsoft dynamics in the SMB market, and we're their partner on a lot of these deals.

And so we think that helped us this quarter and -- excuse me, last quarter that we're reporting and it's already helped us on this quarter.

Okay, great. And I think you mentioned that you have the pipeline to actually grow license revenue in your fiscal fourth quarter despite license sales being up about 150% in the comp quarter.

I think you made some commentary just about the long-term pipeline. I think last quarter, you mentioned that you had never seen quite a jump in the long-term pipeline.

Could you just give us a little bit more color about where that stands now?

That's continuing to grow. I -- we checked it last week and it's at an all-time record again.

Okay. So when I look at your sales force productivity, Mike, I mean, this is just in terms of license revenue per sales and marketing dollar.

I think it's hard to find another company with this kind of sales force productivity. How are you thinking about the expansion of the sales force here?

We're expanding it. It's a lot of hard work to find good sales people.

And of course, we're expanding the VAR channel, but we're also on the direct side for Voyager brand, we're expanding there. We, as we mentioned, I think, the last call, we hope to expand the channel from the beginning of the year, with the direct sales channel from the beginning of the fiscal year to the end, which we're almost at, of about 30%.

And then we have plans similar to that for next year. And we're on track, too, by April 30, May 1, to be there for the 30% growth with the direct channel this year.

Okay. Maybe could you just give us some commentary about the selling environment just in terms of -- just sort of kind of demands commentary?

There's a lot -- there seems to be a lot of interest out there. And we seem to be winning on evaluations.

And where in the past, it seems like our win rate was lower. I think it's higher now.

One of the things we are seeing is that it's taking -- once you get selected, it's sometimes taking longer to get the projects approved and get a contract done. So that sort of switched.

Usually, we've felt like, boy, if we get selected, we'll get it, and it was harder to get selected than it was to close it once you did get selected. Now that's kind of changed, flipped the other way a little bit.

And I think that may be people are just watching their pennies better and more approvals to go through to get the actual dollars allocated.

Okay. And it sounds like despite maybe some longer sales cycles for some of these larger deals that you have in the pipeline here, you have enough coverage with the kind of broader base of business with the expansion of the VAR channels to, I guess, hit your numbers.

Is that fair?

That is fair. It's nice to have multiple channels selling into different sized companies.

Thank you very much for your support of American Software, and we look forward to talking to you on the next call. Goodbye.