Micro Focus Performance Proves Strength Of COBOL Market And Future Of Legacy Applications

Business Wire, Nov 27, 2001

Business Editors

MOUNTAIN VIEW, Calif. & NEWBURY, United Kingdom--(BUSINESS WIRE)-- Nov. 27, 2001

Newly independent enterprise development company

meets first quarter revenue targets

Micro Focus International Ltd. (Micro Focus(R)), a leading global enterprise development company for legacy systems, closed out its first three months as an independent company in October by meeting the financial targets set by its investors. The results validate its strategy to provide organizations a way to maximize existing technology investments by building a bridge between mainframe legacy applications written in COBOL and Web-optimized environments and languages. Micro Focus became independent from MERANT, plc. in August 2001.

"In a year in which the economy, particularly in the technology sector, has taken a major hit, we've seen solid revenue growth and continued adoption of our products and services by companies in our core markets: banking, financial services, insurance, healthcare and government," said Tony Hill, president and chief executive officer of Micro Focus. "Our success stands as an example of the viability of both the future of COBOL technology and the legacy transformation market, as well as underscores Global 1000 companies' commitment to building on their existing IT infrastructure to make their IT budgets go farther."

Micro Focus has won new customers such as the New York City Board of Education, Carrefour and the U.S. Department of Veterans Affairs even as it has strengthened relationships with long-standing customers such as Yasuda Fire and Marine Insurance, Mellon Financial Corporation and Laboratory Corporation of America. The result is solid performance and proof that a company with a 25-year history of leadership in COBOL technology has a solid financial future.

"We continue to hear from our customers about their needs and desire for our continued success in helping them manage their business-critical assets," added Hill. "Customer re-engagement has been critical for our performance to date and will be a continued priority as we enter the second half of our fiscal year." Micro Focus operates on a fiscal year basis that ends April 30 of each year.

This revenue and expense-management performance justifies the confidence the investors saw in purchasing Micro Focus. "We're pleased with our immediate return on investment in Micro Focus and are confident that the company will continue to grow its existing customer base and generate continued value as it moves forward to bridge existing technologies with newer ones, such as .NET, Java and Web services," said David Dominik, managing director, Golden Gate Capital.

In evaluating the company prior to financing its split from MERANT, in conjunction with Parallax Partners, primary investor Golden Gate Capital reacted to the strong global customer base, its COBOL leadership, and the growing market need for legacy transformation and integration. "The benefits of enterprise software are only realized when legacy systems are bridged to support them," said Dominik.

About Micro Focus

Micro Focus is the industry leader in COBOL development solutions spanning traditional maintenance and program understanding to business rule mining, Web-enablement and user-interface transformation. With 70,000 licensed users at more than 7,000 sites around the world, Micro Focus offers unsurpassed breadth of platform support, performance and scalability, and the most comprehensive suite of development and integration environments to help customers succeed in taking full advantage of the power of their legacy systems. Founded in 1976, Micro Focus is a global company that employs more than 450 people worldwide, with principal offices in the United Kingdom and United States. For more information, visit www.microfocus.com.

Micro Focus is a registered trademark of Micro Focus International Ltd. All non-Micro Focus products mentioned in this announcement are property of their respective owners.