Progress Software Reports Fourth Quarter Results; Revenue, Operating Income and EPS All Show Double Digit Increases.BEDFORD, Mass. -- Progress Software Corporation (Nasdaq: PRGS PRGS Phosphoribosylglycinamide Synthetase ), a global supplier of application infrastructure software used to develop, deploy, integrate and manage business applications, today announced results for its fourth quarter ended November 30, 2005. Revenue for the quarter was a record $108.0 million, up 12 percent (13 percent at constant currency) from $96.2 million in the fourth quarter of fiscal 2004. Software license revenue increased 20 percent (same percent at constant currency) to $44.1 million from $36.8 million in the same quarter last year. On a generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ) basis, 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. increased 21 percent to $19.2 million from $15.9 million in the fourth quarter of fiscal 2004. Net income increased 29 percent to $14.0 million from $10.9 million in the same quarter last year. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of increased 18 percent to 33 cents from 28 cents in the fourth quarter of fiscal 2004. On a pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma basis, operating income increased 27 percent to $22.6 million from $17.7 million in the fourth quarter of fiscal 2004. Pro forma net income increased 34 percent to $16.3 million from $12.1 million in the same quarter last year. Pro forma diluted earnings per share increased 23 percent to 38 cents from 31 cents in the fourth quarter of fiscal 2004. The pro forma results in the fourth quarter of fiscal 2005 exclude after-tax charges for amortization of acquired intangibles of $1.7 million, certain other acquisition-related expenses for retention bonuses for key employees of acquired companies of $0.4 million and stock-based compensation related to issuance of restricted stock of $0.1 million. The pro forma results in the fourth quarter of fiscal 2004 exclude an after-tax charge for amortization of acquired intangibles of $1.3 million. For the 12 months ended November 30, 2005, revenue increased 12 percent (10 percent at constant currency) to $405 million from $363 million in fiscal 2004. On a GAAP basis, operating income increased 38 percent to $63.8 million from $46.4 million in fiscal 2004. Net income increased 52 percent to $48.9 million from $32.1 million in fiscal 2004 and diluted earnings per share increased 44 percent to $1.18 from 82 cents in fiscal 2004. On a pro forma basis, operating income increased 42 percent to $79.5 million from $56.0 million in fiscal 2004. Pro forma net income increased 44 percent to $55.8 million from $38.7 million in fiscal 2004. Pro forma diluted earnings per share increased 35 percent to $1.34 from 99 cents in fiscal 2004. The pro forma results in fiscal 2005 exclude after-tax charges for amortization of acquired intangibles of $6.3 million, certain other acquisition-related expenses of $2.3 million, compensation expense from repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of subsidiary stock of $1.9 million, stock-based compensation of $0.1 million and a tax benefit of $3.8 million. The pro forma results in fiscal 2004 exclude after-tax charges for amortization of acquired intangibles of $4.8 million and certain other acquisition-related expenses of $1.8 million. The company's cash and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments at the end of the quarter totaled $266 million. During the fourth quarter, the company purchased 81,000 shares of its stock at a cost of $2.4 million. The company's existing repurchase authorization The right or permission to use a system resource; the process of granting access. See access control. , under which approximately 9.9 million shares remain available for repurchase, expires on September 30, 2006. "All Progress product lines contributed to a successful fourth quarter and a record 2005 fiscal year. Our newer operating units operating unit A type of operating company that engages in transactions with outsiders and that is owned by another business. For example, in 1995 the stockholders of Capital Cities/ABC approved a $19 billion merger with the Walt Disney Company, whereupon - Sonic Software, Proress Real Time and DataDirect Technologies - delivered excellent revenue growth of 33 percent in fiscal 2005 and now account for 36 percent of our software license revenue," stated Joseph Alsop Joseph Wright Alsop V (October 11, 1910 – August 28, 1989) was an American journalist and syndicated newspaper columnist from the 1930s through the 1970s. Alsop was born into a socially prominent family in Avon, Connecticut; the son of Joseph Wright Alsop IV , co-founder and chief executive officer of PSC (Public Service Commission) Same as PUC. . "Revenue from the OpenEdge Division continues to grow and deliver very substantial profitability. We are also pleased to have Neon Systems join us, per the companion press release." Highlights The Progress OpenEdge Division introduced Progress(R) OpenEdge 10.1. Included in this latest release of OpenEdge is a new Eclipse-based integrated development environment See IDE. integrated development environment - interactive development environment (IDE (1) (Integrated Development Environment) A set of programs run from a single user interface. For example, programming languages often include a text editor, compiler and debugger, which are all activated and function from a common menu. ), as well as auditing services designed to address the compliance needs of finance, healthcare, and other industries traditionally affected by audit and compliance requirements Compliance requirements are a series of directives established by United States Federal government agencies that summarize hundreds of Federal laws and regulations applicable to Federal assistance (also known as Federal aid or Federal funds). . http://www.progress.com/new_openedge_platform The Progress OpenEdge Division announced new additions to its award-winning partner program designed to help both existing and prospective application partners learn how to enhance their business applications with the latest technology advances using Progress OpenEdge technology. Based on its highly successful Application Transformation Approach (ATA (1) (AT Attachment) The specification for IDE drives. See IDE. (2) See analog telephone adapter. ATA - Advanced Technology Attachment ), the new Accelerator accelerator: see particle accelerator. (1) A key combination such as Alt-G or Ctrl-Shift H that is used to activate a task. (2) An incubator that expects to develop the company considerably faster than normal. See incubator. Program combines products, services and best practices to bring new partners and their non-Progress-based applications through the SOA-enablement process. http://www.progress.com/enhances_partner_program Sonic Software joined forces with AmberPoint and Systinet to create and publish a new Service-Oriented Architecture See SOA. (SOA (1) (Start Of Authority) The first record in a DNS zone file. See DNS records. (2) (Service Oriented Architecture) The modularization of business functions for greater flexibility and reusability. ) Maturity Model (SOA MM) to assess, guide and establish a vision for maximizing the strategic benefits of SOA investments. The three firms publicly presented the SOA Maturity Model to senior IT decision managers during a 10-city Management Forum Seminar Series designed to educate managers on the strategic business value of SOA. http://www.progress.com/new_soa_maturity_model The Progress Real Time Division introduced the Progress DataXtend(TM) product line, which provides enterprises with key capabilities to efficiently deliver data to applications. The new DataXtend product line includes Progress DataXtend RE (Replication In database management, the ability to keep distributed databases synchronized by routinely copying the entire database or subsets of the database to other servers in the network. There are various replication methods. Engine) for mobile users and others with inconsistent network reliability, and Progress DataXtend CE (Cache Engine) to enable high performance distributed applications An application made up of distinct components running in separate runtime environments, usually on different platforms connected via a network. Typical distributed applications . http://www.progress.com/dataxtend_product_line DataDirect Technologies announced the release of DataDirect XQuery(TM), the first embeddable component for XQuery that is modeled after the XQuery API (Application Programming Interface) A language and message format used by an application program to communicate with the operating system or some other control program such as a database management system (DBMS) or communications protocol. for Java(TM) (XQJ XQJ Xquery Api for Java ). DataDirect XQuery simplifies XML XML in full Extensible Markup Language. Markup language developed to be a simplified and more structural version of SGML. It incorporates features of HTML (e.g., hypertext linking), but is designed to overcome some of HTML's limitations. and relational data integration by providing developers with an XQuery implementation that offers greater productivity, performance and interoperability The capability of two or more hardware devices or two or more software routines to work harmoniously together. For example, in an Ethernet network, display adapters, hubs, switches and routers from different vendors must conform to the Ethernet standard and interoperate with each other. for building standards-based data integration applications. http://www.progress.com/simplify_xml Significant New Customer and Partner Wins, New Technology Adoptions and Major Deployments Significant new partners and customers adopting technology from PSC operating companies operating company A business that engages in transactions with outsiders. , or deploying solutions using PSC technology, include: Abinet Holdings, Adlog BV, Aina Group Oyj, Amdocs Inc., Artesano Moveis Ltda., Atlas Copco Atlas Copco is a Swedish industrial company that was founded in 1873. It manufactures industrial tooling and equipment. The Atlas Copco Group, founded already in 1873, is a global industrial group of companies headquartered in Stockholm, Sweden. Holding GmbH, AutoTrader.com, Bank for International Settlements, Bank of Canada Bank of Canada Canada's central bank, established under the Bank of Canada Act (1934). It was founded during the Great Depression to regulate credit and currency. The Bank acts as the Canadian government's fiscal agent and has the sole right to issue paper money. , Blue Cross of Idaho, Blue River Software, City College Manchester, Community Transit Community Transit is the main public transit authority of Snohomish County, Washington. It operates buses within Snohomish County and to downtown Seattle, the University of Washington, and Seattle's Eastside suburbs in King County. , Configure See configuration. (software) configure - A program by Richard Stallman to discover properties of the current platform and to set up make to compile and install gcc. Cygnus configure was a similar system developed by K. One LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , DDBC DDBC Distributed Database Consulting, Inc DDBC Defense Distribution Depot - Barstow, CA DDBC Dairy Deli Bakery Council (of Southern California) , Inc., Dundee Securities Corporation, Edward C. Levy Company, Evans Ev·ans , Herbert McLean 1882-1971. American anatomist who isolated four pituitary hormones and discovered vitamin E (1922). Company, Fasttrack, First Southwest, Company, Fleet and Industrial Supply Center, Fox Run Solutions, Georgia State University History Georgia State University was founded in 1913 as the Georgia School of Technology's "School of Commerce." The school focused on what was called "the new science of business. , Gevity, Granite granite, coarse-grained igneous rock of even texture and light color, composed chiefly of quartz and feldspars. It usually contains small quantities of mica or hornblende, and minor accessory minerals may be present. State Software, Highbridge Capital Management, Innovations Group Inc., ITE ITE Institute of Transportation Engineers ITE In the Ear ITE Information Technology Equipment ITE Initial Teacher Education (UK) ITE Institute of Technical Education ITE Institute of Terrestrial Ecology Solutions, Inc., Jordan School District Jordan School District is the largest of Utah school districts, with 3,700 teachers who educate more than 80,000 students. An additional 3,500 employees provide support services for the system. , JCM JCM Journal of Clinical Microbiology JCM Journal of Chinese Medicine JCM Japan Collection of Microorganisms JCM Joint Common Missile JCM Journal of Conceptual Modeling JCM Joint Commission Meeting JCM Journal of Composite Materials JCM Job Characteristics Model American Corporation, JD Alpha, Lombard North Central, Motorola, Netezza Corporation, Nexstar, Occidental College History The Birth of Occidental College Occidental College (commonly referred to as Oxy) was founded on April 20, 1887, by a group of Presbyterian clergy and laymen. , Oxford Instruments Oxford Instruments plc is a United Kingdom manufacturing and research company operating in the fields of instrumentation, analysis, plasma processing, cryogenics and superconductivity. , Paypal, Inc., Politiezon Buggenhout-Lebbeke, Pryor Consulting Services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.) service - work done by one person or group that benefits another; "budget separately for goods and services" , Paul Hastings Research Technology Inc., Shands Healthcare, Standford Graduate School of Business, South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. Department of Education, Teracruz, Inc., The TJX Companies The TJX Companies, Incorporated (NYSE: TJX), is the largest international apparel and home fashions off-price department store chain, based in Framingham, Massachusetts, in the United States. , Theodor Rietmann GmbH, Ultra Electronics Ultra Electronics is a British aerospace and defence company. Ultra was formed in 1993 by a management buy-out of seven Dowty Group plc companies from TI Group plc.[1] Dowty had been acquired by TI Group in 1992 for £500 million. Airport Systems, University of Wales Affiliated institutions
VBM Valence Band Maximum VBM Virtual Beit Midrash VBM Visual Backward-Masking VBM Vietnamese Baptist Mission Software LLC and Winterhur Insurance. Significant existing partners and customers adopting technology from PSC operating companies, or making substantial additional deployments of PSC technology, include: Airfoil Technologies International, Ameritrade Holding Inc., American Medical Security, Banc of America Securities, Banco Comafi, Bank of America
Bank of America (NYSE: BAC TYO: 8648 ) is the largest commercial bank in the United States in terms of deposits, and the largest company of its kind in the world. , Barclays Capital Barclays Capital is the investment banking division of Barclays plc. It is a primary dealer in U.S. Treasury securities and various European Government bonds. Barclays Capital is led by CEO Robert (Bob) Diamond, an American who had been vice-chairman of Credit Suisse First , Black & Decker, Blue Cross Blue Shield Blue Shield A US not-for-profit health care insurer that is a reimbursement intermediary for physicians. Cf Blue Cross. Corporation, Boehringer Ingelheim Pharmaceutial, Bristol Meyers, BT Global Services, Bundeswehr, CACI CACI - A company developing and marketing SIMSCRIPT, MODSIM and other simulation software products. Telephone: +1 (619) 457-9681. , ChoicePoint, CIGNA CIGNA CG (Connecticut General Life Insurance Company) INA (Insurance Company of North America) , CitiGroup Inc., eBay, Inc., Elections Canada, Fiserv Lending Solutions, Federal Trade Commission, General Electric Company, Goldman Sachs The Goldman Sachs Group, Inc., or simply Goldman Sachs (NYSE: GS) is one of the world's largest global investment banks. Goldman Sachs was founded in 1869, and is headquartered in the Lower Manhattan area of New York City at 85 Broad Street. & Company, Healthplan Services, Homeserve, ING-Comercial America, IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. (Department of Treasury), JP Morgan Morgan, American family of financiers and philanthropists. Junius Spencer Morgan, 1813–90, b. West Springfield, Mass., prospered at investment banking. , Kaiser Permaente, Lockheed Martin For the former company, see . Lockheed Martin (NYSE: LMT) is a leading multinational aerospace manufacturer and advanced technology company formed in 1995 by the merger of Lockheed Corporation with Martin Marietta. , Pacific Blue Cross, Mercury Interactive For another company with a similar name, see Mercury Computer Systems. HP Mercury (formerly Mercury Interactive) is a subsidiary of Hewlett-Packard that is a market leader in automated software quality assurance and offers products in other areas such as diagnostics, , Mitsubishi UFJ UFJ United Financial of Japan (bank) UFJ Upper Flex Joint Securities, Nationwide Appraisal Services, NCR Corporation (company) NCR Corporation - Electronics company mainly active in the midrange server market. NCR was founded 1884 as National Cash Register Company. It joint the computer industry in th 1950s. , Northrop Grumman Northrop Grumman Corporation (NYSE: NOC) is an aerospace and defense conglomerate that is the result of the 1994 purchase of Grumman by Northrop. The company is the third largest defense contractor for the U.S. , NRI NRI Nomura Research Institute (Tokyo, Japan) NRI Non-Resident Indian NRI Natural Resources Institute NRI National Resources Inventory NRI Networked Readiness Index NRI Natural Resources Inventory NRI National Research Institute , Pueblo County Government, State of Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). , Tarrant County Auditors Office, Technische Universitaet Berlin, Telecom Italia Mobile TIM (Telecom Italia Mobile) is Telecom Italia's mobile phone brand, and runs a GSM, EDGE, UMTS and HSDPA network in Italy and a GSM network with EDGE in Brazil. In Europe, TIM is part of the FreeMove alliance. TIM Peru was sold to América Móvil and rebranded Claro. , Total Systems, Inc., Universal Forest Products Inc. and Verizon Data Services. Business Outlook The company is providing the following guidance for the first fiscal quarter ending February 28, 2006: --Revenue is expected to be in the range of $103 million to $105 million. GAAP operating income is expected to be in the range of $9 million to $10 million, including amortization of acquired intangibles, stock-based compensation expense (including amounts associated with FASB FASB See: Financial Accounting Standards Board FASB See Financial Accounting Standards Board (FASB). No. 123(R), "Share-Based Payments," which the company will adopt in the first quarter of fiscal 2006), and certain other acquisition-related expenses of approximately $9 million. --GAAP diluted earnings per share are expected to be in the range of 15 cents to 17 cents. --On a pro forma basis, operating income is expected to be in the range of $18 million to $19 million, excluding amortization of acquired intangibles, stock-based compensation and certain other acquisition-related expenses of approximately $9 million. --On a pro forma basis, diluted earnings per share are expected to be in the range of 29 cents to 31 cents, excluding approximately 14 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. for amortization of acquired intangibles, stock-based compensation and certain other acquisition-related expenses. The company is providing the following guidance for the fiscal year ending November 30, 2006: --Revenue is expected to be in the range of $435 million to $445 million. GAAP operating income is expected to be in the range of $51 million to $54 million, including amortization of acquired intangibles, stock-based compensation and certain other acquisition-related expenses of approximately $37 million. --GAAP diluted earnings per share are expected to be in the range of 85 cents to 91 cents. --On a pro forma basis, operating income is expected to be in the range of $88 million to $91 million, excluding amortization of acquired intangibles, stock-based compensation and certain other acquisition-related expenses of approximately $37 million. --On a pro forma basis, diluted earnings per share are expected to be in the range of $1.45 to $1.51, excluding approximately 60 cents per share for amortization of acquired intangibles, stock-based compensation and certain other acquisition-related expenses. The above guidance includes an estimate for the impact of the acquisition of Neon, which is expected to be completed in January 2006. Any delays in the completion of this transaction could have a material effect on this guidance. Conference Call PSC's conference call to discuss its fourth quarter results will be Webcast live today at 9:00 a.m. Eastern via CCBN CCBN Central Coast Bancorp CCBN Charles County Business Network on the company's Web site, located at www.progress.com/investors. The call will also be Webcast live via Yahoo (www.yahoo.com), Motley Fool (www.fool.com), Streetevents (www.streetevents.com), TD Waterhouse TD Waterhouse is the brand used for both British and Canadian brokerages within the TD Bank Financial Group. The brand originated as a United States brand for discount brokerage when TD purchased Waterhouse Securities. (www.tdwaterhouse.com) and Fidelity.com (www.fidelity.com). An archived version of the conference call will be available for replay. About Progress Software Corporation Progress Software Corporation (Nasdaq: PRGS) is a global industry leader providing application infrastructure software for all aspects of the development, deployment, integration and management of business applications through its operating units: Progress OpenEdge Division, Sonic Software, DataDirect Technologies, and Progress Real Time Division. Headquartered in Bedford, Mass., Progress can be reached at www.progress.com or +1-781-280-4000. 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. Statement Except for the historical information and discussions contained herein, statements contained in this release may constitute "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including but not limited to the following: the receipt and shipment of new orders, the timely release of enhancements to the company's products, the growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. of certain market segments, the positioning of the company's products in those market segments, variations in the demand for customer service and technical support, pricing pressures and the competitive environment in the software industry, business and consumer use of the Internet, and the company's ability to penetrate international markets and manage its international operations Internal Operations (I.O., IO or I/O) is a fictional American Intelligence Agency in Wildstorm comics. It was originally called International Operations. I.O. first appeared in WildC.A.T.S. volume 1 #1 (August, 1992) and was created by Brandon Choi and Jim Lee. . The company undertakes no obligation to update information contained in this release. For further information regarding risks and uncertainties associated with the company's business, please refer to the company's filings with the Securities and Exchange Commission. Progress, DataXtend, DataDirect XQuery, and OpenEdge are trademarks or registered trademarks of Progress Software Corporation in the U.S. and other countries. Java and all Java-based marks are trademarks or registered trademarks of Sun Microsystems Sun Microsystems, Inc. (NASDAQ: JAVA[3]) is an American vendor of computers, computer components, computer software, and information-technology services, founded on 24 February 1982. , Inc. in the U.S. and other countries. Any other trademarks contained herein are the property of their respective owners.
Progress Software Corporation
Condensed Consolidated Statements of Income
Three Months Ended
--------------------------------
November 30, November 30, Percent
(In thousands except per share data) 2005 2004 Change
----------------------------------------------------------------------
Revenue:
Software licenses $ 44,084 $ 36,798 20 %
Maintenance and services 63,873 59,396 8 %
------------------------
Total revenue 107,957 96,194 12 %
------------------------
Costs and expenses:
Cost of software licenses 2,501 1,990
Cost of maintenance and services 13,981 12,743
Sales and marketing 43,274 38,581
Product development 15,269 15,580
General and administrative 10,374 9,566
Amortization of acquired
intangibles 2,538 1,871
Stock-based compensation 134 -
Acquisition-related expenses, net 653 -
------------------------
Total costs and expenses 88,724 80,331 10 %
------------------------
Income from operations 19,233 15,863 21 %
Other income, net 1,557 101
------------------------
Income before provision for income
taxes 20,790 15,964 30 %
Provision for income taxes 6,757 5,108
------------------------
Net income $ 14,033 $ 10,856 29 %
------------------------
Earnings per share:
Basic $ 0.35 $ 0.30 17 %
Diluted $ 0.33 $ 0.28 18 %
------------------------
Weighted average shares outstanding:
Basic 39,953 36,212 10 %
Diluted 43,083 38,997 10 %
------------------------
Pro Forma Condensed Consolidated Statements of Income
Three Months Ended
November 30, 2005
---------------------------------
As Pro Forma
(In thousands except per share data) Reported Adjustments Pro Forma
----------------------------------------------------------------------
Revenue:
Software licenses $ 44,084 $ 44,084
Maintenance and services 63,873 63,873
--------------------------------
Total revenue 107,957 107,957
--------------------------------
Costs and expenses:
Cost of software licenses 2,501 2,501
Cost of maintenance and services 13,981 13,981
Sales and marketing 43,274 43,274
Product development 15,269 15,269
General and administrative 10,374 10,374
Amortization of acquired
intangibles 2,538 $(2,538) -
Stock-based compensation 134 (134) -
Acquisition-related expenses,
net 653 (653) -
--------------------------------
Total costs and expenses 88,724 (3,325) 85,399
--------------------------------
Income from operations 19,233 3,325 22,558
Other income, net 1,557 1,557
--------------------------------
Income before provision for income
taxes 20,790 3,325 24,115
Provision for income taxes 6,757 1,081 7,838
--------------------------------
Net income $ 14,033 $ 2,244 $ 16,277
--------------------------------
Earnings per share:
Basic $ 0.35 $ 0.41
Diluted $ 0.33 $ 0.38
--------------------------------
Weighted average shares outstanding:
Basic 39,953 39,953
Diluted 43,083 43,083
--------------------------------
Three Months Ended
November 30, 2004
-----------------------------------------
As Pro Forma Percent
(In thousands except per Reported Adjustments Pro Forma Change
share data)
----------------------------------------------------------------------
Revenue:
Software licenses $ 36,798 $ 36,798 20 %
Maintenance and services 59,396 59,396 8 %
--------------------------------
Total revenue 96,194 96,194 12 %
--------------------------------
Costs and expenses:
Cost of software
licenses 1,990 1,990
Cost of maintenance and
services 12,743 12,743
Sales and marketing 38,581 38,581
Product development 15,580 15,580
General and
administrative 9,566 9,566
Amortization of acquired
intangibles 1,871 $ (1,871) -
Stock-based compensation - - -
Acquisition-related
expenses, net - - -
--------------------------------
Total costs and
expenses 80,331 (1,871) 78,460 9 %
--------------------------------
Income from operations 15,863 1,871 17,734 27 %
Other income, net 101 101
--------------------------------
Income before provision for
income taxes 15,964 1,871 17,835 35 %
Provision for income taxes 5,108 598 5,706
--------------------------------
Net income $ 10,856 $ 1,273 $ 12,129 34 %
--------------------------------
Earnings per share:
Basic $ 0.30 $ 0.33 24 %
Diluted $ 0.28 $ 0.31 23 %
--------------------------------
Weighted average shares
outstanding:
Basic 36,212 36,212 10 %
Diluted 38,997 38,997 10 %
--------------------------------
Progress Software Corporation
Condensed Consolidated Statements of Income
Twelve Months Ended
--------------------------------
November 30, November 30, Percent
(In thousands except per share data) 2005 2004 Change
----------------------------------------------------------------------
Revenue:
Software licenses $ 156,846 $ 140,462 12 %
Maintenance and services 248,530 222,200 12 %
------------------------
Total revenue 405,376 362,662 12 %
------------------------
Costs and expenses:
Cost of software licenses 8,150 8,973
Cost of maintenance and services 55,309 52,354
Sales and marketing 157,073 146,171
Product development 63,018 60,371
General and administrative 42,322 38,753
Amortization of acquired
intangibles 9,399 7,076
Compensation expense from
repurchase of subsidiary stock 2,803 -
Stock-based compensation 134 -
Acquisition-related expenses, net 3,403 2,600
------------------------
Total costs and expenses 341,611 316,298 8 %
------------------------
Income from operations 63,765 46,364 38 %
Other income, net 3,099 843
------------------------
Income before provision for income
taxes 66,864 47,207 42 %
Provision for income taxes 17,931 15,106
------------------------
Net income $ 48,933 $ 32,101 52 %
------------------------
Earnings per share:
Basic $ 1.28 $ 0.89 44 %
Diluted $ 1.18 $ 0.82 44 %
------------------------
Weighted average shares outstanding:
Basic 38,227 36,031 6 %
Diluted 41,571 39,010 7 %
------------------------
Pro Forma Condensed Consolidated Statements of Income
Twelve Months Ended
November 30, 2005
---------------------------------
As Pro Forma
(In thousands except per share data) Reported Adjustments Pro Forma
----------------------------------------------------------------------
Revenue:
Software licenses $ 156,846 $ 156,846
Maintenance and services 248,530 248,530
--------------------------------
Total revenue 405,376 405,376
--------------------------------
Costs and expenses:
Cost of software licenses 8,150 8,150
Cost of maintenance and services 55,309 55,309
Sales and marketing 157,073 157,073
Product development 63,018 63,018
General and administrative 42,322 42,322
Amortization of acquired
intangibles 9,399 $ (9,399) -
Compensation expense from
repurchase of subsidiary stock 2,803 $ (2,803) -
Stock-based compensation 134 $ (134) -
Acquisition-related expenses,
net 3,403 (3,403) -
--------------------------------
Total costs and expenses 341,611 (15,739) 325,872
--------------------------------
Income from operations 63,765 15,739 79,504
Other income, net 3,099 3,099
--------------------------------
Income before provision for income
taxes 66,864 15,739 82,603
Provision for income taxes 17,931 8,915 26,846
--------------------------------
Net income $ 48,933 $ 6,824 $ 55,757
--------------------------------
Earnings per share:
Basic $ 1.28 $ 1.46
Diluted $ 1.18 $ 1.34
--------------------------------
Weighted average shares outstanding:
Basic 38,227 38,227
Diluted 41,571 41,571
--------------------------------
Twelve Months Ended
November 30, 2004
-----------------------------------------
As Pro Forma Percent
(In thousands except per Reported Adjustments Pro Forma Change
share data)
----------------------------------------------------------------------
Revenue:
Software licenses $ 140,462 $ 140,462 12 %
Maintenance and services 222,200 222,200 12 %
--------------------------------
Total revenue 362,662 362,662 12 %
--------------------------------
Costs and expenses:
Cost of software
licenses 8,973 8,973
Cost of maintenance and
services 52,354 52,354
Sales and marketing 146,171 146,171
Product development 60,371 60,371
General and
administrative 38,753 38,753
Amortization of acquired
intangibles 7,076 $ (7,076) -
Compensation expense from
repurchase
of subsidiary stock - $ - -
Stock-based compensation - $ - -
Acquisition-related
expenses, net 2,600 (2,600) -
--------------------------------
Total costs and
expenses 316,298 (9,676) 306,622 6 %
--------------------------------
Income from operations 46,364 9,676 56,040 42 %
Other income, net 843 843
--------------------------------
Income before provision for
income taxes 47,207 9,676 56,883 45 %
Provision for income taxes 15,106 3,096 18,202
--------------------------------
Net income $ 32,101 $ 6,580 $ 38,681 44 %
--------------------------------
Earnings per share:
Basic $ 0.89 $ 1.07 36 %
Diluted $ 0.82 $ 0.99 35 %
--------------------------------
Weighted average shares
outstanding:
Basic 36,031 36,031 6 %
Diluted 39,010 39,010 7 %
--------------------------------
Progress Software Corporation
Condensed Consolidated Balance Sheets
November 30, November 30,
(In thousands) 2005 2004
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Assets
Cash and short-term investments $ 266,420 $ 191,267
Accounts receivable, net 66,592 63,503
Other current assets 33,315 23,485
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Total current assets 366,327 278,255
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Property and equipment, net 42,816 40,658
Goodwill and intangible assets, net 134,270 107,363
Other assets 23,425 20,538
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Total $ 566,838 $ 446,814
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Liabilities and shareholders' equity
Accounts payable and other current
liabilities $ 74,896 $ 70,669
Short-term deferred revenue 99,697 101,106
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Total current liabilities 174,593 171,775
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Long-term debt 1,938 2,200
Long-term deferred revenue 5,068 5,861
Other liabilities 3,580 -
Shareholders' equity:
Common stock and additional paid-in
capital 140,883 70,085
Retained earnings 240,776 196,893
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Total shareholders' equity 381,659 266,978
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Total $ 566,838 $ 446,814
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Condensed Consolidated Statements of Cash Flows
Twelve Months Ended
November 30,
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(In thousands except per share data) 2005 2004
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Cash flows from operations:
Net income $ 48,933 $ 32,101
Depreciation, amortization and other
noncash charges 18,323 19,123
Other changes in operating assets and
liabilities 14,277 21,086
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Net cash flows from
operations 81,533 72,310
Capital expenditures (10,909) (10,716)
Acquisitions, net of cash acquired (32,161) (99,320)
Share issuances, net of repurchases 43,481 8,140
Other (6,791) 1,722
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Net change in cash and short-term
investments 75,153 (27,864)
Cash and short-term investments, beginning
of period 191,267 219,131
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Cash and short-term investments, end of
period $ 266,420 $ 191,267
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