Baan shares take bath after warning

Baan expects to confirm on 28 October that its revenue will be in the $190 to $195 million range for Q3, but that there was a loss of between $0.13 and $0.16 per share. So far, the FY is 30 per cent up for the first nine months over the previous-year first nine months. This funny habit, which is increasing, of making a preliminary announcement of poorer results seems to be a way of saying "We did tell you as soon as we knew, please don't be harsh on us." The same applies to reassuring conference calls to the all-powerful financial analysts, whose casual and often highly-ignorant remarks for their own truly-vested interests can damage a company that is in fact doing rather well, but not necessarily in quarterly stages. The Dutch Beurs heard the news before trading started, and the result was a rout. The volume of trading in Baan shares was ten times the normal, and the fall 29 per cent to NLG 23.50 - and this was on a day when 28 of the AEX 30 shares index went up, to give an AEX rise of 6 per cent. Baan has disappointed investors, since in April the shares reached NLG 107.80. Monday was a twelve-month low. Although the revenue will be up for the quarter just ended, compared with the year-earlier quarter, Baan failed to close sufficient deals in the quarter to make the numbers. Jan Baan, the founder and former CEO, attributed the problem to the usual culprit: the global financial crisis delaying decisions. The complex private dealings by Jan Baan with Baan private companies some months ago, after which Baan stepped down, did not help the share price. In his keynote address, Baan put it down to 30 sales prospects that did not sign-up before the end of the quarter. A cheery note was that there were more new customers in the quarter than ever before. ® Click for more stories