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Updated from 4:22 p.m. EST

Manhattan Associates

(MANH) - Get Manhattan Associates, Inc. Report

reported a decline in fourth-quarter earnings and lower-than-expected revenue after the close Tuesday. Still, the software maker beat earnings expectations by a penny.

Shares of Manhattan Associates were recently up $2.04, or 7.6%, to $29 in after-hours trading after falling 59 cents, or 2.1%, to $26.96 in Tuesday's regular session.

Under generally accepted accounting principles, Manhattan Associates reported net income of $6.5 million, or 21 cents a share, in the fourth quarter. That compared to net income of $7.5 million, or 25 cents a share, in the same period a year earlier.

Excluding charges, Manhattan Associates said it earned pro forma net income of $7.2 million, or 23 cents a share, in the fourth quarter, compared to pro forma net income of $7.0 million, or 23 cents a share, a year earlier. Analysts polled by Thomson One Analytics were expecting pro forma earnings of 22 cents a share.

Revenue rose 8.3% year over year to $49.4 million. Revenue rose 14% excluding a recovery related to the bankruptcy of


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in 2002. Analysts were calling for $51.1 million in fourth-quarter revenue from Manhattan Associates, which makes supply-chain applications.

One potential explanation for the revenue shortfall: The company's four largest prospective deals during the fourth quarter were not closed and slipped into 2004, according to Manhattan Associates. One of those is now in the contract phase, two are progressing through the pipeline and one has become less certain, CEO Richard Haddrill said on a postclose conference call.

Still, license fees reached a record $12.1 million, up 14% from a year ago and up 25% from the third quarter.

Manhattan Associates makes supply-chain applications and is among the few software makers poised to take advantage of the emerging RFID, or radio frequency identification, market being driven by requirements set by


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and the Department of Defense. Haddrill said six companies have signed contracts with Manhattan Associates for RFID products, 28 proposals are outstanding and 20 proposals are being prepared.

Manhattan Associates also was selected to be part of an RFID pilot project for nine companies that will run through July of this year. All told, more than 600 companies have "explored RFID with Manhattan Associates," Haddrill said. "We remain convinced that RFID will be a key contributor to our future growth."

Looking forward, Manhattan expects pro forma earnings in 2004 to range from 91 cents to $1.04 a share and GAAP earnings to range from 83 cents to 96 cents a share. That assumes the capital spending environment improves modestly during the year. The company did not provide revenue guidance or its outlook for the first quarter.