Boole & Babbage reports record results; License growth was 21% for Q4 and 24% for the year; For Q4 operating income was up 37% and EPS increased 39% to $.50; Margins increased to 10.4% for the year.

SAN JOSE, Calif.--(BUSINESS WIRE)--Nov. 9, 1995--Boole & Babbage, Inc. (NASDAQ: BOOL) announced that revenues for its fiscal fourth quarter ended September 30, 1995 were a record $41,173,000 or a 16% increase over the fiscal 1994 revenues of $35,627,000.

Operating income was up 37% to $4,460,000 compared with $3,249,000 in 1994's fourth quarter. Related earnings per share increased 39% to $.50, compared to $.36 last year.

For the year ended September 30, 1995, revenues were up 17% to a record $154,367,000 and operating income, excluding 1994's acquisition related purchased R&D write-off, was up 26% to $16,044,000. Related earnings per share was up 27% to a record level of $1.81 compared to $1.42 for fiscal 1994. Including the purchased R&D write-off, reported earnings per share for 1995 increased by 65%. Cash and installment leases increased to $98 million compared to $72 million last year.

"I'm quite pleased with the consistency of our 21% license growth in the fourth quarter," said Paul E. Newton, President and CEO of Boole & Babbage. "Each product group hit new record levels as our mainframe products and services increased nearly 20% while the client/server products grew by 26%. In our sales channels, North America rebounded from a disappointing third quarter to increase 17% to a new record and International grew by 23% to near-record levels.

"Our overall 1995 license growth of 24%, which followed a 20% increase in 1994, shows a consistent, accelerated growth rate reflecting the continued successful execution of our Enterprise Automation strategy along with effective customer-oriented business practices.

"This past quarter represented the 16th consecutive quarter of improved operating results and revenue growth. We raised our operating margins to nearly 11% and increased our earnings per share by 39% to record levels. Consistency is again shown by our earnings per share increasing at an average annual rate of 32% since the 1992 turnaround year. Other achievements included surpassing the $40 million revenue milestone for a quarter, achieving our highest-ever operating margins on an annual basis, and the sixth straight quarter in which client/server revenues attained record levels and showed growth on a sequential basis as well.

"And, on a promising note for the future, we also achieved the first revenues from our new alternate VAR sales channels in North America as our UNIX systems management product, Ensign, was successfully launched after correcting some packaging issues that had hindered the initial rollout. I'm also pleased to report that our Board has once again approved a 3-for-2 stock split which will be payable December 6, 1995.

"In the fourth quarter, we launched several new client/server product initiatives to further strengthen our Enterprise Management and Automation market position and increase opportunities for cross-product selling. New product options for COMMAND/POST include Pinpoint -- a Windows-based alert display and connect Ensign -- an intelligent agent extension for enhanced event management. Also launched was Ensign Alarm for Novell NetWare which provides centralized and distributed control for UNIX and NetWare environments.

"With product initiatives such as these, and specialized marketing programs designed to support an increased sales channel focus toward distributed products, we are well on our way to positioning Boole & Babbage as a major contender in the rapidly growing distributed systems management market," Newton concluded.

Boole & Babbage is a leader in enterprise automation software for distributed systems. The Company is committed to supporting open systems and the growing client/server market to help IS organizations reduce costs and increase systems availability. Boole & Babbage maintains strategic alliances with industry leaders to ensure its customers receive the most powerful, efficient solutions. Founded in 1967, Boole & Babbage sells more than 40 products in North America, Europe, Asia, Australia, and Latin America.

Following are highlights of fiscal 1995's fourth quarter and annual results: -0-

          Condensed Consolidated Statements of Income (Audited)
             (In thousands, except per share amounts)

                          Q495        Q494        FY95        FY94
Revenues                $41,173     $35,627     $154,367    $131,796
Costs and expenses       36,713      32,378      138,323     119,032

  Operating income        4,460       3,249       16,044      12,764

Purchased R&D expense        --          --           --      (3,251)
Other income              1,120         593        3,904       2,003

  Pretax income           5,580       3,842       19,948      11,516

Income taxes              1,680       1,190        6,000       3,570
Tax rate                   30.0%       31.0%        30.0%       31.0%

Net income               $3,900      $2,652      $13,948      $7,946

Earnings per share:(a)
  Before purchased R&D
   expense               $ 0.50      $ 0.36       $ 1.81      $ 1.42
  As reported            $ 0.50      $ 0.36       $ 1.81      $ 1.10

Shares outstanding(a)     7,830       7,358        7,700       7,200

(a) Before effect of 3-for-2 stock split payable December 6, 1995

 Condensed Consolidated Balance Sheets (Audited, except Mar 31, 1995)

                               Sept. 30,      Mar. 31,      Sept. 30,
                                  1995           1995          1994
Cash                           $ 38,140      $ 41,658       $ 34,019
Trade receivables                27,293        22,926         23,180
Lease and other receivables      60,289        44,864         38,262
Furniture and equipment           7,341         8,174          8,506
Capitalized software             12,278        13,274         14,276
Other                            18,567        13,924         13,383

  Total Assets                 $163,908      $144,820       $131,626

Accrued expenses               $ 31,877      $ 30,515       $ 30,200
Other liabilities                 3,607         4,810          6,296
Deferred maint. income           58,237        52,785         46,905
Stockholders' equity             70,187        56,710         48,225
  Total Liabilities and
   Equity                      $163,908      $144,820       $131,626

CONTACT: Boole & Babbage, Inc.

Arthur Knapp, 408/526-3333