NetScout Systems Reports Financial Results for Third Quarter of Fiscal 2007.Revenue up 6% Sequentially WESTFORD, Mass. -- NetScout Systems, Inc. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : NTCT NTCT Negative Temperature Coefficient Thermistor ), a leading provider of network and application performance management solutions, today announced financial results for its third quarter of fiscal year 2007. Total revenue for the third quarter of fiscal year 2007 was $26.5 million, up 6% year-over-year. Net income was $2.0 million, an increase of 5% on a year-over-year basis, leading to net income per diluted share of $0.06. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. , which included stock-based compensation expense of $357,000 and amortization of acquired intangible assets of $143,000, was $1.9 million in the third quarter of fiscal 2007, representing an operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: of 7%. "We are pleased with our financial results in the third quarter with revenue and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. at the high end of our previously issued guidance," said Anil Singhal, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of NetScout Systems. "During the quarter we released enhancements to our nGenius Performance Management Solution targeted at the wireless service provider market for deployment in their revenue generating, customer facing networks. We expect the wireless service provider segment to continue to provide significant opportunity with our new product focus. Looking ahead we expect the strength we saw in the third quarter will continue through next quarter and accelerate going forward. In addition, we remain confident in our EPS growth target of 40% in fiscal year 2008." Financial and Company Highlights for the Third Fiscal Quarter 2007: * Total revenue increased 6% year-over-year and 6% sequentially. * Operating margin was 7% of total revenue, down 2 points year-over-year and down 3 points sequentially. * Cash and short and long-term marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has increased by $4.4 million to $95.1 million in the third quarter. * During the quarter NetScout provided enhancements to its nGenius Performance Management Solution targeted at wireless service providers' revenue generating, customer facing networks. NetScout's carrier-class capabilities will give service providers requisite deep visibility into IP traffic to accurately plan for capacity expansion and to reduce Mean Time to Restore by rapidly troubleshooting IP service degradations. * NetScout introduced nGenius Performance Manager for NetFlow that supports Cisco's NetFlow and IP SLA (1) (StereoLithography Apparatus) See 3D printing. (2) (Service Level Agreement) A contract between the provider and the user that specifies the level of service expected during its term. by combining nGenius Performance Manager with nGenius Collector appliances in a cost effective solution. * NetScout's nGenius Performance Manager and nGenius Analytics received IBM's "Ready for IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) Tivoli Software Tivoli Software is the systems management brand of the IBM Software Group. IBM purchased Austin-based Tivoli Systems, Inc. in 1996[1] and allowed it to operate as a wholly owned subsidiary for a few years before forming the Software Group. " validation with the integration of the nGenius Solution with IBM Tivoli NetView IBM Tivoli NetView is a Monitor Program based on SNMP Protocol, and a part of Tivoli Modules. This program provide real time monitoring and you can make active test over all servers supported by SNMP. . * NetScout received Frost & Sullivan's 2006 Customer Value Enhancement Award, recognizing innovation in the network performance monitoring & management category. * During the quarter NetScout increased its presence in the growing Asia Pacific region with a new office in Australia and a channel partnership agreement with Tenfold Network Solutions Pty. serving the Australia and New Zealand New Zealand (zē`lənd), island country (2005 est. pop. 4,035,000), 104,454 sq mi (270,534 sq km), in the S Pacific Ocean, over 1,000 mi (1,600 km) SE of Australia. The capital is Wellington; the largest city and leading port is Auckland. markets. In addition NetScout expanded coverage in the Middle East with a channel partnership with Equinox equinox (ē`kwĭnŏks), either of two points on the celestial sphere where the ecliptic and the celestial equator intersect. The vernal equinox, also known as "the first point of Aries," is the point at which the sun appears to cross the International based in Dubai. Guidance: For the fourth quarter of fiscal year 2007, the Company expects total revenue to be in the range of $26.5 million to $27.5 million and net income per diluted share to be in the range of $0.04 to $0.05. Included in forecasted net income per diluted share is a non-recurring charge of $0.03 per share relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc a retirement and advisory agreement for the Company's outgoing Founder and Chairman, Mr. Narendra Popat. The Company expects a fourth quarter operating margin of 7 to 8 percent which would equate to a 12 to 13 percent operating margin if the non-recurring charges related to Mr. Popat's agreement, which account for a five point reduction in operating margin, were excluded. The Company reiterates its long-range guidance for net income per diluted share growth of 40% in fiscal year 2008. CONFERENCE CALL INSTRUCTIONS: The Company invites shareholders to listen to its conference call today at 4:30 p.m. ET, which will be webcast live through the Company's website at http://www.netscout.com/investors. Alternatively, people can listen to the call by dialing 866-701-8242 for U.S./Canada and 706-634-5113 for international callers and using conference ID: 6233829. A replay of the call will be available after 7:30 p.m. ET on January 25 for approximately one week. The number for the replay is 800-642-1687 for U.S./Canada and 706-645-9291 for international callers. The conference ID is: 6233829. About NetScout Systems, Inc. NetScout Systems, Inc. (NASDAQ: NTCT) is a market leader and pioneer of integrated network A network that supports both data and voice and/or different networking protocols. See converged network and new public network. and application performance management products and solutions that assure critical business services across the enterprise. More than 3200 organizations worldwide have deployed NetScout's nGenius[R] Performance Management System to increase their return on infrastructure investments by optimizing the performance of networks and applications according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. business priorities. NetScout is headquartered in Westford, Massachusetts and has offices worldwide. Further information is available at http://www.netscout.com. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. : Forward-looking statements in this release are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 and other federal securities laws. Investors are cautioned that statements in this press release, which are not strictly historical statements, including the plans, objectives and future financial performance of NetScout, constitute forward-looking statements which involve risks and uncertainties. Actual results could differ materially from the forward-looking statements. Risks and uncertainties which could cause actual results to differ include, without limitation, risks and uncertainties associated with the Company's relationships with strategic partners, dependence upon broad-based acceptance of the Company's network performance management solutions, the Company's ability to achieve and maintain a high rate of growth, introduction and market acceptance of new products and product enhancements, the ability of the Company to take advantage of service provider opportunities, competitive pricing pressures, reliance on sole source suppliers, successful expansion and management of direct and indirect distribution channels and dependence on proprietary technology, and risks of slowdowns or downturns in economic conditions generally and in the market for network performance management solutions specifically. For a more detailed description of the risk factors associated with the Company, please refer to the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the fiscal year ended March 31, 2006 on file with the Securities and Exchange Commission. NetScout assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein. (c)2007 NetScout Systems, Inc. All rights reserved. NetScout and the NetScout logo, nGenius, and Quantiva are registered trademarks of NetScout Systems, Inc. Other brands, product names and trademarks are property of their respective owners. [TABLE OMITTED] [TABLE OMITTED] |
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