Jalal Pirzada: CEO Maria Legos: COO Colleen McDonald: CFO

Oracle Business Description Sector: Technology Industry: Software and Programming Oracle Develops, manufactures, markets & distributes software Oracle world’s largest supplier of Database Oracle core products are database, development tools, applications for system integration Famous products: Oracle9i database&server, e- business suite 11i, OTN online services Oracle offers consulting, training, and other These services accounted 56% revenue in FY00

The E-Business Kit MarketingHR Sales Expenses FinancialsSupply Chain Requisitions ExchangesService

E-Business Suite 11i, Complete & Simple MarketingHR Expenses FinancialsSupply Chain Requisitions ExchangesService Sales

History 1977 Larry Ellison, founded Software Development Laboratories. Built a new type of database, Relational Database SDL changed their name to Relational Software Inc. (RSI) 1982 RSI changes their name to Oracle Corporation Introduces V-3, the first portable database Oracle becomes the world’s largest DBMS software company Sells products in 86 countries Cross GUI Toolset is introduced.

1994Multimedia Server Database is released. 1995Larry Ellison announces the concept of the network computer. 1996Network Computer Inc. is created to market the network computer Oracle Version 2.1 of Oracle Designer/2000 and Oracle Developer/2000, Oracle brings applications to the web, and Oracle ships Oracle Release II of Oracle Applications, Oracle introduces Business Intelligence System. 1999Oracle develops Oracle8i. 2000Oracle delivers E-Business Suite (11i).

Mission To complete the process of becoming an E- Business suite and in doing so save over one billion dollars and also continue to be a market leader in the software for information management.

Vision To use a global database by integrating all aspects of the business e-marketplace: Marketing Sales Service HR Financial Expenses Supply Chain Requisitions Exchanges

Strategic Objectives By sharing information we can: Eliminate duplication of effort Achieve specialization and economies of scale Standardize business processes and implement best practices. To have an internet-ready platform for building and developing Web-based applications.

Strategic Objectives (cont.) To have a comprehensive suite of internet- enabled business applications. To have professional services to help in formulating e-business strategy, as well as in designing, customizing, and implementing e-business solutions. We want to obtain more than the top ten of the industries.

Financial Objectives To save over one billion dollars in annual savings, by improving our operating margin by 41%. To have our revenue increase at least 15% in Fiscal year Education was our worst performance organization, we believe education is now capable of margins of 50%. We want to sell more and spend less: –We want to go above 500% in our stock –We want to increase our application sales to 71% –Want our revenue to increase from $8.8b to $10.1b

S.W.O.T. Analysis Strengths Oracle’s holding of 42.2% is more than twice the market share than their closest competitors, oIBM DB2 holding is 20.4% oMicrosoft SQL Server is 7.8% oOthers with 29.4% All ten of the world’s largest Web sites from Amazon.com to Yahoo! – Use Oracle. 98 of the Fortune 100 use Oracle for e - business.

Strengths Oracles’ E-Business Suite, was the first and only set of applications to work with a single global database. Oracle practices a high-level of community involvement. Oracle became a more responsive and efficient organization by having all of their customers, suppliers and employees online. Oracle has low inventory compared to its competitors. In the education industry, 49 of the top 50 U.S. universities run Oracle.

Strengths 10 of the Top 10 Financial Services companies run Oracle. 10 of the Top 10 Health & Pharmaceutical companies run Oracle. 8 of the Top 10 High-Tech Manufacturers run Oracle. 10 of the Top 10 Manufacturing companies run Oracle. 9 of the 9 Media companies on the Standard 100 run Oracle.

Strengths 8 of the Top 10 Fortune 500 Specialty Retailers run Oracle. 8 of the 10 I-Builders on the standard 100 run Oracle. 10 of the Top 10 Telecommunications companies run Oracle. 9 of the Top 10 Transportation companies run Oracle.

Weaknesses Oracle software is so powerful in capacity, the selling price is very high Oracle’s stock is time low Will be reducing size of Oracle Consultants Oracle was criticized for not finishing the product

Opportunities The opportunity for obtaining more of database market share, there is 57.6% held by competitors. Oracle has a high reputation established in the industry on the basis of scalability, maturity and reliability. Oracle is only half way through their e-business transformation. In the new era of globalization the E-Business Suite works in every country and in every language.

Opportunities Opportunities available by using the Internet are endless, every business function – marketing, sales, supply chain, manufacturing, customer service, accounting,and human resources all use the same global network and the same global database. Competitor’s application software such as Epiphany for marketing, Clarify for service etc… are not designed or built to work together. Oracles marketing programs are increasing their reach due to generating leads via .

Threats The problem with new technology and security issues which are not fully explored. Potential customers still choosing to use application software for each part of their company. Low entry of barriers increase the threat of competition. Constant change of technology, Oracle as a market leader must reinvest into Research & Development.

Market Data: Oracle 2000 HQ Located: Redwood City, CA Employees: Nasdaq: ORCL 52-Week High, Low:$43.47, $22.75 Shares Outstanding (M): Market Value (M): $ Revenue Growth for Oracle 15.2% Revenue Growth for Industry 12.6%

Annualized Financial Performance $2.5 B79% $2.5 B79% 54% 54% Revenue Net Income* Application License $10.7 B 15% $10.7 B 15% Database License 21% 21% Trailing 12 Months: FY 00 & FY 99 Operating Margin 35.0% vs. 22.9% 35.0% vs. 22.9%

10 Quarters of Margin Improvement FY 1999 Y-Y % Operating Margin Change FY FY

Financial Ratios Analysis Profitability Ratios: 1. Net Profit Margin = measures the percentage Of profits earned per dollar of sales All figures in millions Net Profit Margin = Net Profit/ Net Sales / = 63.28% Oracle = 63.28%Industry = 9.54% Oracle earns 63 cents on every $1 of sales.

Profitability Ratios 2. Return On Assets: measures the percentage of Profits earned per dollar of asset Return On Assets = Net Profit / Total Assets / = 76.2% Oracle = 76.2% Industry = 3.6% Oracle makes 76 cents on every 1 dollar of Assets it Employs in its operations.

Liquidity Ratios 1. Current Ratio: measures how liquid is a Company on a balance sheet date Current ratio = Current Asset / Current Liability / = 2.15 Oracle = 2.15:1 Industry = 3.42:1 Oracle has $2.15 current assets to meet every $1 Dollar of its current liability.

Liquidity Ratios 2. Quick Ratio: company’s ability to pay off short Term obligations without relying on the sales of its Inventories. Quick Ratio: Current Assets – Inventories / CL – / = 2 Oracle = 2:1 Industry = 3.2:1 Oracle has $2 of quick assets to meet every $1 of its Current liabilities.

Leverage Ratios 1.Interest Coverage Ratio: measurement of how Many times interest payment could be made from Firm’s earnings before Int, Exp, & Tx. Interest Coverage Ratio = Earnings before interest & taxes / Interest Expense / 17.5 = Oracle = Industry = 22 Oracle has a higher ICR then Industry, It is more Solvent & can meet interest obligations many times.

Leverage Ratios 2. Debt-To-Equity Ratio: funds provided by Creditors versus owners. Higher D-T-E ratio means Creditors have more stake & risk then shareholders Debt-To-Equity = Total Debt / Stockholders’ Equity / = 0.06 Oracle = 0.06 Industry = 0.06 Oracle has 6 cents of debt for every $1 dollar of Equity to meet its long term obligations.

Activity Ratios 1. Days of Sales Outstanding: how long in days It takes a company to convert sales receivables into Cash from customers. Days Sales Outstanding = T. AR / T. C sales x / x 365 = Oracle = 65 Days Industry = 105 Days It takes 65 days for Oracle to convert its receivables Into cash. Net terms 30 days, 65 – 30 = 35 days

Activity Ratios 2. Asset Turnover: If a company’s ratio is below the Industry ratio then a company is not generating Sufficient sales given the size of its asset investment. Asset Turnover = Sales / Total Assets / = 1.4 Oracle = 1.4 Industry = 0.4 Oracle earns $1.4 sales from every $1 of investment In assets.

Recommendations Oracle9i or Oracle Student version Versus MS Access & SQL. Advertise more. Less consultant more Quick Implementation with Oracle 11i Suite. Wrong strategy consulting services accounts 56% revenue. Security Issues: Global Database (Internet) Data encryption, firewall, antivirus.

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