Cognos Reports Record Fourth Quarter and Full Year Results -- Net Profits for the Year Increase by 185 percent.

OTTAWA, Ontario--(BUSINESS WIRE)--April 10, 1995--Cognos Incorporated (TSE:CSN;NASDAQ:COGNF) today announced results for its fourth quarter and fiscal year ended February 28, 1995. Revenue for the quarter was $47.5 million, a 20 percent increase over the same period last year. Net income was $5.4 million and net income per share was 40 cents, compared with net income and net income per share of $2.3 million and 18 cents, respectively, for the same period last year.

Revenue for the 12 months ended February 28, 1995 was $168.2 million, an increase of 12 percent over revenue of $150.1 million for fiscal 1994. Net income and net income per share were $11.4 million and 86 cents, respectively. This compares with net income and net income per share of $4.0 million and 31 cents, respectively, for the previous fiscal year. Cash balances for the year increased by $27.8 million to a level of $75.0 million.

Michael U. Potter, Chairman and CEO of Cognos, stated, "By all measures, this quarter was a strong finish to a year of outstanding progress.

"We are especially pleased with the growth in our Business Intelligence products. In the quarter, revenue from PowerPlay and Impromptu was $16.1 million, an increase of over 150 percent from the fourth quarter of last year. In this quarter, these products accounted for 48% of our revenue from license sales. For the fiscal year, total revenue was $41.8 million, up over 160 percent from the prior year. With external estimates indicating that this market is growing at 70 - 80 percent annually, we believe we have been consistently increasing our market share and now hold a clear leadership position in this exciting segment."

"These results reflect not only the acceptance of PowerPlay and Impromptu as enterprise standards by major corporate accounts but also the expansion of our third party channels. During fiscal 1995, 27 per cent of our license sales of Business Intelligence products came from third parties, compared with 17 per cent in fiscal 1994. In addition, we added 150 authorized resellers during the year."

Revenue in the fourth quarter from the company's application development tools business, which includes both PowerHouse and Axiant, was $31.4 million. This compares with revenue of $33.1 million in the fourth quarter of the previous fiscal year. "The revenue levels in this business are tracking as we had expected," noted Potter. "Growth in open systems platforms and client/server tools is partially offsetting declines on proprietary platforms.

"Axiant 1.1 was released in February, delivering full deployment capabilities to our new, client/server application development toolset. With $2.3 million of revenue for the fiscal year from Axiant, we finished ahead of our goals for this new product. More importantly, we are quite pleased with the feedback from our customer base on the capabilities of Axiant and with strong interest in our FastTrack Centers for migrating existing applications and building new ones. We believe we are laying the foundation for solid acceptance of this product in the coming year."

Potter added, "We are also happy with the results of continued tuning of our business model. During the year, sales productivity increased by 23 percent and overall productivity by 14 percent. We added over 4 percentage points to our operating margins while, at the same time, making significant investments in product development, marketing and channel development. We also note that these improvements happened across all our major geographic markets, with revenue growth, productivity increases and improved accounts receivable performance across North America, Europe and portions of Asia/Pacific.

"For Cognos," Potter concluded, "this was a great year. As we marked our twenty-fifth anniversary as a company, we achieved record levels of revenue and earnings. Life-to-date revenues for our traditional PowerHouse product surpassed one billion dollars, and at the same time we emerged in the leadership position in the new high growth sector of business intelligence tools. Not surprisingly, the strategies and vision at Cognos are much different than those in 1969, but we are very confident that they will serve us well in the latter half of the 1990's. With a strong management team in place, a committed group of employees, a large base of loyal customers, and a strong product roll out plan for the coming year, we are very much looking forward to fiscal 1996."

Cognos develops, markets and supports - both directly and through resellers worldwide - advanced client/server application development and reporting tools on a wide range of open and proprietary platforms, including UNIX and the Microsoft Windows desktop. Cognos is a publicly held company with dual headquarters in Ottawa, Canada and Burlington, MA.

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Fourth Quarter Results

All figures are reported in thousands of Canadian dollars,
except per share figures which are shown in dollars.

                                  ($000)
                              Fourth Quarter
                                  Ended
                               Last Day of
                                 February
                              1995      1994

Revenue                      47,513    39,543
Operating expenses           41,229    36,274
Operating income              6,284     3,269
Income before taxes           7,057     3,599

Net income                    5,390     2,262
Net income per share           0.40      0.18

                                  ($000)
                               Twelve Months
                                  Ended
                               Last Day of
                                 February
                              1995      1994

Revenue                     168,161   150,109
Operating expenses
  (excluding restructuring
   charges)                 154,618   143,329
Restructuring charges             -     1,543
Operating income             13,543     5,237
Income before taxes          16,007     6,670

Net income                   11,365     3,981
Net income per share           0.86      0.31

CONTACT: Cognos Incorporated, Burlington MA

Roberta J. Carlton, 617/229-6600

Malena Abel, 613/738-1440