Good afternoon, my name is Molly and I will be your conference facilitator today. At this time I would like to welcome everyone to the Manhattan Associates quarter one 2008 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be question and answer period. (Operator Instructions) As a reminder, ladies and gentlemen this call is being recorded today, April 22, 2008. I would now like to introduce Dennis Story, Chief Financial Officer of Manhattan Associates. Mr. Story you may begin your conference.

Good afternoon everyone. Welcome to the Manhattan Associates 2008 first quarter earnings call. Before we launch in to the results discussion I will review our cautionary language and then turn the call over to Pete Sinisgalli, our CEO. During this call including the question and answer session we may make forward-looking statements regarding future events or future financial performance of Manhattan Associates. You are cautioned that these forward-looking statements involve risk and uncertainties and are not guarantees of future performance and that actual results may differ materially from those in our forward-looking statements. I refer you to the reports Manhattan Associates files with the SEC for important factors that could cause actual results to differ materially from those in our projections particularly our annual report on Form 10K for fiscal 2007 and the risk factor discussion in that report. We are under no obligation to update these statements. In addition, our comments will cover certain non-GAAP financial measures. These measures are not in accordance with or an alternative for GAAP and may be different from non-GAAP measures used by other companies. We believe that this presentation of certain non-GAAP measures facilities investors’ understanding of our historical operating trends with useful insight in to our profitability exclusive of unusual adjustments. Our Form 8K filed today with the SEC and available from our website www.Manh.com contains important disclosure about our use of non-GAAP measures. Also, our earnings release filed with the Form 8K reconciles our non-GAAP measures to the most directly comparable GAAP measures. Now, I’ll turn the call over to Pete.

I’m pleased to share with everyone highlights from our first quarter of 2008. Dennis will follow with more color on these results and I’ll wrap up with an overview of our outlook for the balance of 2008 and our financial guidance. And, of course, we’ll be happy to answer questions after our prepared remarks. This call should provide a good opportunity for everyone to ask questions. Over the past few months five analysts that covered Manhattan Associates have left their firms. Since several of them tended to be quite active in the Q&A session of our call their departures should represent an opportunity for everyone. We look forward to your questions. I’m quite pleased with our performance in the quarter particularly with respect to license revenue and earnings per share. We achieved total revenue of $88.3 million an increase of 13% over the prior year all of which is organic. This is our 14th straight quarter of posting double digit revenue growth. Our ability to grow our top line revenue and our earnings per share impressively, consistently and organically is a testament to our market leadership and to the bottom line value companies derive from our solutions. License revenue for the quarter was $18.3 million which was 33% better than the prior year. You may recall from our last call how we had two deals push from Q4 2007. Both of those closed in Q1 and are reflected in our license growth rate. We also achieved a first quarter record adjusted earnings per share of $0.35, an increase of 52% over Q1 of last year. I’ll now turn the call back over to Dennis to provide details on our financial results.

Despite the global macroeconomic pressures that are tightening budgets and lengthening purchasing cycles, Manhattan delivered record revenue and earnings per share performance in the first quarter. EPS and net income highlights for the quarter were as follows: we reported Q1 2008 adjusted EPS of $0.35 today representing a 52% increase over our Q1 2007 adjusted EPS of $0.23. Adjusted net income in the first quarter increased 31% to $8.7 million over Q1 2007. Our adjusted EPS performance exceed the consensus EPS estimate of $0.27 for the quarter by $0.08 reflecting very strong operating results combined with non-operational fx gains. On a non-operating basis $0.04 of the $0.08 were driven by $1.6 million in fx gains reported in other income. Approximately $1.3 million of these gains are non-cash unrealized gains due to the weaker dollar. These fx gains were triggered from translation of intercompany loans established from cash funding of our international operations due to significant appreciation primarily in the Euro and the Yen in Q1 2008. Details of the currency impact by the quarter are included in the supplemental information schedule we provided in today’s earnings release. So, excluding the fx gains adjusted EPS grew 35% to $0.31, $0.04 better than the consensus estimate with $0.02 derived from strong operating results and $0.02 attributed to lower diluted shares. On a GAAP basis we reported record GAAP EPS of $0.30 in Q1 an increase of 58% compared to Q1 2007, very strong EPS performance in the quarter. On to revenue and operating results; as Pete noted, we delivered record Q1 consolidated revenue totaling $88.3 million, representing 13% growth over the prior year quarter and marking our 14th consecutive quarter of double digit revenue growth. Excluding the impact of currency Q1 top line growth was 12% so the top line currency impact…

Our Q1 financial results were solid and position us well for 2008. We had a successful quarter adding new clients and expanding our relationships with existing clients. Our earnings release notes some of the major ones that have given us permission to disclose their names. We signed four deals this quarter of $1 million or more in recognized license revenue. Two of these were with new customers and two were existing clients. For two of the four, warehouse management was the lead product. For another, transportation management was the lead product and replenishment was the lead product for the fourth large deal. The replenishment deal was with an existing client and shows the power of our suite of optimization solutions and our ability to leverage our install base. About 50% of the total first quarter license fees were generated from new customers and the remaining 50% came from sales to existing customers. License fees for our warehouse management solutions for the quarter were about 50% of our total license fees and about 50% was from non-warehouse management solutions. For the quarter our warehouse management solutions license revenue grew by about 20% over 2007 as we continue to take share in this space. Our non-WMS products grew by more than 50% over Q1 of 2007. As Dennis mentioned, we posted very strong license revenue growth in EMEA and APAC and reported about flat license revenue in the Americas. It’s worth pointing out however that the United States portion of the Americas posted license revenue growth of a little more than 10% in Q1 versus Q1 of last year. That growth was offset by a decline in license revenue recorded in Q1 for the Americas region outside the United States. Overall, I’m quite pleased with the Americas license revenue results for Q1.…

(Operator Instructions) We’ll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Aaron Schwartz with JP Morgan. Aaron Schwartz – JP Morgan: I had a question on the services margins. I know you provided quite a bit of commentary and understanding you’ve invested heavily in that segment, can you talk a little bit about if the margins are more a function of your planned investments or if there is in fact a timing difference of the mix shift to open systems?

It’s a combination of both as you obviously caught from our comments during the prepared remarks. Headcount and services is up about 22% year-over-year while overall services revenue is up about 9%. We certainly have continued to invest in services headcount growth recognizing that is one of the primary competitive differentiators of Manhattan versus the competition. Secondarily some of the product mix does put some additional pressure on our services margin. One other comment that’s probably worth making, what we’re anticipating over the balance of 2008 is the likelihood of some delays in system upgrades due to economic pressures which will probably put some additional pressure on our services business. We’re anticipating that due to economic conditions, services upgrades maybe delayed in some cases which will put some timing pressure on our overall services business but the good news there of course if those upgrades will occur and we’ll capture that revenue but we’re anticipating at the moment that the combination of a little bit of investment in our services business and some of the timing of some services revenue will put a little pressure on our services margins going forward. Aaron Schwartz – JP Morgan: And that being said, have you gotten through the heavy lifting in terms of the services investments so should we expect that to decelerate going forward?

Yes, we have. Aaron Schwartz – JP Morgan: And then just a question on the Americas license growth, I know you talked about the US relative to the broader Americas, can you talk about the hiring in the direct sales side? I think you said that you expected to add about 12 for the year, you’re mostly through that. Is that largely in the Americas or is there anything that’s changed there to get to the flat overall license growth?

We mentioned on the last earnings call that we’d about a dozen sales reps around the world, that they’d primarily be in the United States since that’s where most of the license revenue opportunity is, in the first quarter we added about nine reps around the world with about the majority being in the United States. So we do think that as I mentioned in my comments the US portion of license revenue in the Americas was up a little bit more than 10%. We’d like to think that we can continue to sell through with a difficult environment and encourage the new reps to participate in some of that new opportunity and contribute to full year results. But as you can imagine people that have just joined the company will likely be less productive than some of our experienced sales reps and certainly our outlook for the balance of 2008 reflects that. Aaron Schwartz – JP Morgan: I guess what I was getting to is do you think the growth in the Americas is more a function of the economy or were you in fact maybe under-resourced from a sales perspective?

It’s tough, Aaron, quarter-to-quarter to comment specifically on one quarter’s outlook. We think we have a solid pipeline for the balance of 2008 across the different product suites in the Americas. We certainly hear the same things everyone hears about different segments of the economy and are cautiously optimistic that we’ll be able to work through that. Having said that, I don’t think we had missed opportunities either in the first quarter this year or the fourth quarter of last year because we were understaffed in the sales team.

Your next question comes from the line of Brad Reback with Oppenheimer. Brad Reback – Oppenheimer & Co.: I know you won’t give specific guidance with respect to revenue, Pete, but we are up against a fairly significant comp from last year on the license line from the second quarter, should be much like you guys talked about 4Q and 1Q added together looking like a 13% growth rate, should we look at an average for the first half of this year versus the first half of last year?

Yeah, I’m not sure that would be an accurate measure, Brad, only because the first quarter of this year was quite, quite strong. Last year’s first quarter was solid. Last year’s second quarter was quite strong. So I think there’d be a little bit of an apples and oranges comparison that might unfairly lower expectations for Q2 of 2008. We clearly have most of the quarter in front of us and our results are far from definitively predictable at this point, but I think that calculation that you just described would probably be a little bit more conservative than we feel at the moment. Having said that, there is a lot of work to do. We did have a very strong Q2 last year, we did a little more than $23 million in license revenue in Q2 of last year. So we’ve got a lot of wood to chop to be able to deliver on our expectation for Q2 of this year. However, we believe the pipeline looks sold and our sales teams are performing well so we’re cautiously optimistic that we’ll be able to have a quarter that delivers adjusted EPS in that $0.36 to $0.44 range. Brad Reback – Oppenheimer & Co.: Just to pick up on a comment from the previous question, the hiring and the services business it’s sort of 20%, that will moderate here fairly significantly going forward?

You should expect by and large that our services headcount should grow in line with our services revenue by and large. So we did have some opportunities to hire some talented people in different parts of the world and I took advantage of those opportunities but as a general rule obviously that’s a bill-by-hour business. We will try very hard to match headcount growth with revenue growth. Now and again we’ll have some opportunities to hire some talented people that would distort that perhaps a little bit and at other times we may see greater productivity because we are able to increase some of the performance of our team. But I think by and large our gross margin for services is as good or better than any other company on the planet so we’re quite pleased with the performance of our team. We’re just looking for opportunities to continue to extend our sustainable competitive advantage in that area. Brad Reback – Oppenheimer & Co.: On the commentary around potential delays, have customers indicated to you at all yet that they’re thinking of pushing out or is that just a cautionary prudent comment?

Every quarter, every year we’ll have a couple of customers that delay for a lot of different reasons. So far we’ve seen about the normal level of delay. That could be because they’re opening new stores or adding a new product line. There’s a lot of reasons for it. So far in Q1 we’ve seen about the normal level of delay in upgrades but we are being a little bit cautious given our customer base and the challenges some of them are going through.

Your next question comes from the line of Yun Kim with Pacific Growth Equities.

Obviously you had good execution in Q1 but obviously with the down tick in the economy do you see higher risk associated with your sales execution and sales pipeline expansion in your core retail and CPG verticals? And then also if you can talk about your progress and your current sales pipeline outside of your core retail and CPG verticals as well?

We feel pretty good about our overall pipeline both in the retail CPG space and outside the retail and CPG third party logistics provider space. We do believe we executed well in the first quarter in sales to our targeted markets in the US and Asia Pac and in Europe. So I think the sales teams executed well in all areas. We certainly talk to the same folks you guys talk to, read the same news articles, watch the same television programs and hear a lot of the concerns retailers in consumer goods companies are expressing about the economy and some of the impact on their businesses so we continue to be concerned about that. However, at the same time, we’ve mentioned this a couple times in the past, our solutions tend to drive very real demonstrable cost savings in transportation costs, in labor costs, in inventory carrying costs and because of that in most difficult economic times, solutions like ours move up the priority list because they have demonstrable ROI in a very manageable time period so the payback period is usually quite attractive. We believe even though retail CPG and some other vertical markets may be struggling a little bit, we believe given our pipelines and the activity we have in the marketplace that we can sell through some of those economic difficulties as we have in Q1. In Europe we don’t yet seem to be seeing many of the same economic challenges we’re seeing that are generally exhibited in the US and same is true in Asia, of a much smaller base for us. We think with the geographic distribution we have, the different vertical markets we serve, the different products we deliver, solutions we deliver and the demonstrable ROI we have an opportunity to continue to perform well in a challenging economic environment.

Can you also give us an update regarding the non-WMS product line? That seems to be doing very well. Like transportation obviously, that saves a few costs, ETN replenishment, they all seem to be growing much faster than WMS products consistently over the past few quarters. What is the secret sauce there and any interesting trends that you’ve seen regarding the size of these non-WMS deals?

As I mentioned, two of the $1 million plus deals in the quarter were led by non-WMS products and two were led by WMS solutions so we feel that’s a very good mix. Transportation specifically in some vertical markets we’re tending to do very well and we would like to think we’ll continue to do very well. Obviously with the cost of oil continuing to rise and the pressure that puts on companies’ transportation costs and optimization solution in transportation has great appeal. We think that we’ve had some good success, had a very nice win this quarter that was quite helpful. The same is true in areas like replenishment and order management. We’ve had some very good success with extended enterprise management. We think those applications continue to grow well and as we’ve mentioned on previous calls, one of the great assets we do have is a very satisfied installed base of warehouse management customers that we can cross sell our solutions into. We think part of the reason we’re very pleased with the WMS Q1 growth rate of 20% year-over-year. Even practically more excited about a 50%+ growth rate in the non-WMS solutions and believe our solution suite gives us some natural competitive advantages in the marketplace that we believe is extendable.

And finally just going with those services margins theme here, I guess since you guys had a good quarter I guess it’s a good time to bring this up, what is the leverage there in the service margin and when can we start to see this leverage and how much improvement do you think you need from the current level to get yourself into about 20% operating margin? Or do you think that 20% operating margin can only be achieved through faster license revenue growth?

Actually I think that Dennis has covered this on a couple of calls. I’ll throw in a few comments and then he can add to it. We think we’ll get to the 20% operating margin in 2010 by a number of factors. The primary factors will be greater leverage of our operating costs, sales and marketing, research and development and general and administrative costs as we continue to grow overall revenue and gross margin dollars. We don’t believe our operating expenses will grow nearly as quickly. Secondarily we think our international operations which generally have lower gross operating margins than the United States operation as those business units continue to grow rapidly they’ll be able to contribute more to the overall margin. In terms of the services margin, the one thing I would suggest, we have a very attractive services margin overall, as good as anyone else in the industry that we can track and we try to track everyone and believe our services gross margin is the envy of the industry. Having said that, we do believe that there are opportunities over time for our services gross margin to improve primarily in our non-WMS solutions, our newer solutions where we have less experience, less install base and we’re frankly trailing some new ground. As we get greater mobility in those market spaces we do think there’s upside in the services margin particularly to those areas. It would be very hard for us to improve our WMS services margin and our I series business unit. We think that’s better than anyone on the planet, but we do think in other areas we have a change to do better.

Just to follow up on that comment, are you guys opposed to doing any deals besides those deals that could increase the license revenue contribution overall just to change the margin structure or some sort of that type of acquisition or that would not necessarily be the criteria overall?

We’re open minded to any M&A activity acquisition that can improve shareholder value so we wouldn’t exclude any. I don’t think we particularly bias our analysis though for a license revenue focus business unit that might give the appearance of an improved operating margin. Clearly if there were benefits to our customers, our shareholders and our employees, we’re open minded to any approach but I don’t think we’d try to, for lack of a better word, rig the system by looking for a particular acquisition that would change our overall revenue mix just to post for public consumption a higher margin.

Your next question comes from the line of Atul Bagga with ThinkPanmure. Atul Bagga – ThinkPanmure: A quick question, can you add some more color on the pipeline? Maybe some quantitative information, how does it look versus three months, six months ago? And a follow up to that can you also talk about the close rates and how the close rates have been trending?

Sure, would be happy to. We don’t provide specific numbers for our pipeline but we believe our pipeline is quite attractive at this point in time and comparable to what we’ve seen over the past year or two. Different parts of the world a little different than others, but by and large we believe we’ve got an adequate pipeline given our historic close rates to be able to deliver on the guidance we’ve provided for Q2 and for the balance of 2008. Atul Bagga – ThinkPanmure: In terms of close rates, are they consistent over the last six months? Or are you seeing any changes there?

I would suggest to you that our close rate has improved a bit over the past six months. Part of the reason for that is I believe our competitive position has improved. I’m not sure the overall market has grown that there are more deals being done in total. As I said in previous calls the market growth most analysts see in the space is somewhere in that 6 to 7% range. We’re growing 2X that on a regular basis 14 quarters in a row I think is the math. Obviously we’re taking market share and that generally would indicate that we’re closing at a higher rate than any of our competitors or that we had in the past. Atul Bagga – ThinkPanmure: Also you talked about adding the sales reps, 15 sales rep in Q4, nine in Q1. How long does it take for these sales reps to become fully productive?

Just to clarify we didn’t add 15 reps in Q4. What we said on the Q4 call was for 2008 we expected to add about a dozen reps for 2008. So far in 2008 in the first quarter we’ve added nine sales reps. Generally speaking a sales rep will take anywhere from three months to nine months to become productive and that generally is dependent upon their experience level when they join the company. If they joined us from a direct competitor, obviously they’re up the learning curve a lot more quickly. If they’ve joined us from a business that is quite similar to ours but not a direct competitor it takes a bit longer to get all the specifics down. So somewhere in that time frame. Quite frankly people that we add to the sales team in 2008 we’re not banking on a contribution to meet our results for 2008. Atul Bagga – ThinkPanmure: And in terms of the sales quota, does it seem the way it’s been as before? Can you talk a little bit on that?

Comparable but it varies based on their area of focus. We have selling teams that focus on different product groups and different geographies. Generally speaking the sales representatives in the United States that are focused on selling warehouse management have a higher dollar quota than sales representatives that are focused on selling our non-WMS products. Obviously no big surprise there in terms of our market strength. That’s a logical outcome and I would suggest that our quotas are about in line with what they were last year, maybe a little bit higher across the board.

Your next question comes from the line of Mark Schappel with The Benchmark Company.

Pete, your prepared remarks you noted that AMEA had an especially strong quarter and I was wondering if there were any additional product localizations that were released in the quarter or was this just a function of good performance from the other sales force?

Actually it was just a very good performance by the sales team. We did not expand the quantity of products that we offer in the AMEA marketplace in Q1. I think the team just executed very well. I would suggest our competitive position in Europe has improved substantially over the last three, four quarters. Our win rate has increased substantially over that time period and our pipelines look solid as well. I think Steve Smith, who heads up our AMEA operation, has done a spectacular job at getting that team focused and executing well and we’re quite pleased with our performance there.

Regarding the new sales reps that were hired in the quarter, were the bulk of them located overseas?

The majority would be in the United States.

And then finally on the competitive point, can you just comment on any impact you’re seeing from some of the upstart, on demand supply chain vendors if any?

So far we haven’t seen much quite frankly. I guess there is one on demand WMS vendor. There are a couple of transportation on demand vendors and for the most part not much in other areas of supply chain management. We do occasionally bump into a couple of the on demand transportation management solution vendors. As I think you probably know, Mark, we also offer an on demand transportation solution and announced I think last week a new addition to our customer base for that solution suite so we continue to be competitive in that space as well as with an on premise application sale. But we’ve not seen much increase in the on demand competitive profile in the supply chain management space.

At this time we have time to take one more question and your final question comes from the line of Tom Carpenter with Hilliard Lyons. Tom Carpenter – Hilliard Lyons: A follow up to the last question, it looks like you guys are starting to gain a lot of traction in AMEA and will be there shortly and APAC. I saw on your customer win list you had an international company or two, can you give us some insight into overseas? Is that still mainly US companies that are doing business over there as you’re starting to increase your win rate among local domestic companies in those markets?

That’s a great question, Tom. It’s a combination of both and we think that combination of both though is quite attractive. I’ll use a couple of quick examples for you. Our first entry into the Asian Pacific we leveraged a couple of large global companies and particular few logistics providers that have global reach to start getting some traction in markets and that initial traction has allowed us to get some references in those markets that allow us to compete more favorably for a local client. An example of that would be in China. During the quarter we announced the addition of [Neader’s Bondway] which is a large retailer in China to our portfolio of companies in China using our solutions. We are quite pleased on that win in the market and believe that kind of profile will allow us to be successful with our retailers in China. It continues to be a nice combination of in market global players providing positive references for us that give us more creditability in this market and we think that will continue to expand. We also have a couple of very nice global customers that are rolling out our solutions in new markets for us and we’re quite excited about the potential those new geographies can bring to our success. Over the past year or so we’ve had some nice success in emerging markets like Russia and South Africa, the Middle East and are starting to see some additional traction in some of the South East Asia markets. So, we believe that combination of having large global players leveraging our solutions around the world as well as the opportunity to sell to global players based on good references from the large global player is a real up side possibility for Manhattan. I’d like to thank everyone for joining us for the call. We appreciate your questions and look forward to speaking with you in about 90 days. Good night.

This concludes today’s conference call. You may now disconnect.