OPNET Reports Record Revenue and Earnings for Fiscal Q2 2004
- Record revenue of $13.4 million
- Record operating margins of 14.3%
- Record diluted EPS of 7 cents
BETHESDA, MD - October 28, 2003 --OPNET Technologies, Inc. (NASDAQ: OPNT), a leading provider of management software for networks and applications, today announced financial results for its second fiscal quarter ended September 30, 2003. Revenue for the quarter ended September 30, 2003 was $13.4 million compared to $11.1 million for the same quarter in the prior year. Earnings per share for the second quarter of fiscal 2004 was $0.07 on a diluted basis, compared to $0.03 in the same quarter of the prior year.
For the six months ended September 30, 2003 and 2002, revenues were $25.7 million and $22.3 million, respectively. Earnings per share for the six months ended September 30, 2003 was $0.10 on a diluted basis, compared to $0.05 in the comparable period ended September 30, 2002.
OPNET Chairman & CEO, Marc A. Cohen, stated, “ We are extremely pleased to report a record-breaking quarter across key metrics, including revenue, operating income, operating margins, and diluted earnings per share. The significant increase in operating margin in Q2 demonstrates the substantial operating leverage of our business model. Our top-line growth was driven by sales execution, and we plan on continuing to scale our direct sales force to fuel future growth.”
Third Quarter Fiscal Year 2004 Financial Outlook
OPNET expects fiscal third quarter revenue to be between $13.5 and $14.0 million and diluted earnings to be between 6 and 8 cents per share. These amounts represent management’s current expectations about the Company’s future financial performance, based on information available at this time.
Financial Highlights for the Second Quarter of Fiscal Year 2004
- Grew revenue year over year 20.6% to a record
$13.4 million from $11.1 million in revenue for the second quarter
of fiscal 2003. Revenue for the quarter grew sequentially 8.9%
from $12.3 million for the first quarter of fiscal 2004.
- Expanded operating margins sequentially
from 7.3% to 14.3% in the quarter resulting in record operating
income of $1.9 million.
- Increased diluted earnings per share 75%
to a record 7 cents from 4 cents in the first quarter of fiscal
2004.
- Maintained a strong balance sheet with $73.5
million in cash and marketable securities at September 30, 2003.
- Increased deferred revenues to a record $11.4 million from $11 million at the end of the first quarter of fiscal 2004.
The Company will hold an investor conference call on Tuesday, October 28, 2003 at 5:00 pm Eastern Time to review financial results for the second quarter of fiscal 2004. Investors will be able to listen to the call by calling 877-407-9210 in the U.S. or 201-689-8049 for international callers, and enter password OPT-04, or use the webcast at www.opnet.com, or at www.vcall.com (click on OPNT under "Today's VCalls"). Investors are advised to go to the web site at least 15 minutes early to register, download, and install any necessary audio software. Call the replay phone number at 877-660-6853 or 201-612-7415 for international callers. For replay, enter account # 1628, conference ID # 79559. The replay will be available from 7:00 pm Eastern Time October 28th through 11:59 pm Eastern Time October 31st. The webcast will be available at www.opnet.com or at www.vcall.com, archived for seven days.
About OPNET Technologies, Inc.
Founded in 1986, OPNET Technologies, Inc. is a leading provider
of management software for networks and applications. For more
information about OPNET and its products, visit www.opnet.com.
OPNET and OPNET Technologies, Inc. are trademarks of OPNET Technologies, Inc. All other trademarks are the property of their respective owners.Statements in this press release that are not purely historical facts, including statements about expected financial performance in future periods, constitute forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. OPNET Technologies, Inc. ("OPNET") assumes no obligation to update these statements. Forward-looking statements are based upon information available to OPNET as of the date of this press release and involve risks and uncertainties; therefore, actual events or results may differ materially. For a discussion of risk factors that could affect OPNET’s future performance, see OPNET's most recent 10-Q, filed with the Securities & Exchange Commission. These risks include, among others, the evolving nature of our market, the length and variability of our sales cycle, and risks regarding our ability to successfully expand our sales force.
OPNET
Technologies, Inc.
Condensed
Consolidated Statements of Operations
(unaudited)
|
|
|
Three Months Ended |
|
Six Months Ended |
|
||||
|
|
|
September 30, |
|
September 30, |
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||||
|
|
|
2003 |
|
2002 |
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2003 |
|
2002 |
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|
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(in thousands, except per share data) |
|
||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
New software licenses and other |
|
$ 6,708 |
|
$ 4,884 |
|
$ 12,874 |
|
$ 10,239 |
|
|
Software license updates and technical support |
|
3,626 |
|
3,130 |
|
6,967 |
|
6,126 |
|
|
Professional services |
|
3,067 |
|
3,098 |
|
5,865 |
|
5,900 |
|
|
Total revenues |
|
13,401 |
|
11,112 |
|
25,706 |
|
22,265 |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues: |
|
|
|
|
|
|
|
|
|
|
|
New software licenses and other |
|
231 |
|
190 |
|
488 |
|
380 |
|
|
Software license updates and technical support |
|
367 |
|
428 |
|
743 |
|
904 |
|
|
Professional services |
|
1,717 |
|
1,076 |
|
3,254 |
|
2,280 |
|
|
Amortization of acquired technology |
|
125 |
|
126 |
|
250 |
|
251 |
|
|
Total cost of revenues |
|
2,440 |
|
1,820 |
|
4,735 |
|
3,815 |
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
10,961 |
|
9,292 |
|
20,971 |
|
18,450 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
3,109 |
|
3,234 |
|
6,306 |
|
6,375 |
|
|
Sales and marketing |
|
4,553 |
|
4,452 |
|
9,080 |
|
8,970 |
|
|
General and administrative |
|
1,388 |
|
1,183 |
|
2,770 |
|
2,368 |
|
|
Total operating expenses |
|
9,050 |
|
8,869 |
|
18,156 |
|
17,713 |
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
1,911 |
|
423 |
|
2,815 |
|
737 |
|
|
Interest and other income, net |
|
150 |
|
241 |
|
301 |
|
524 |
|
|
Income before provision for income taxes |
|
2,061 |
|
664 |
|
3,116 |
|
1,261 |
|
|
Provision for income taxes |
|
717 |
|
151 |
|
1,008 |
|
316 |
|
|
Net income |
|
$ 1,344 |
|
$ 513 |
|
$ 2,108 |
|
$ 945 |
|
|
Basic net income per common share |
$ 0.07 |
|
$ 0.03 |
|
$ 0.11 |
|
$ 0.05 |
|
||
Diluted net income per common share |
$ 0.07 |
|
$ 0.03 |
|
$ 0.10 |
|
$ 0.05 |
|
||
Weighted average common shares outstanding (basic) |
19,603 |
|
19,263 |
|
19,528 |
|
19,213 |
|
||
Weighted average common shares outstanding (diluted) |
20,479 |
|
19,918 |
|
20,310 |
|
19,879 |
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
OPNET Technologies, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
March 31, |
|
|
|
|
2003 |
|
2003 |
|
ASSETS | (in thousands) |
||||
Current assets: |
|
|
|
|
||
|
Cash and cash equivalents |
|
$ 28,073 |
|
$ 70,251 |
|
|
Marketable securities |
|
45,452 |
|
- |
|
|
Total cash and marketable securities |
|
73,525 |
|
70,251 |
|
|
|
|
|
|
|
|
|
Accounts receivable, net |
|
9,445 |
|
6,420 |
|
|
Unbilled accounts receivable |
|
1,692 |
|
933 |
|
|
Prepaid expenses and other current assets |
|
1,822 |
|
1,412 |
|
|
|
Total current assets |
|
86,484 |
|
79,016 |
|
|
|
|
|
|
|
Property and equipment, net |
6,541 |
|
7,008 |
|||
Intangible assets, net |
1,317 |
|
1,566 |
|||
Goodwill |
|
12,212 |
|
12,212 |
||
Other assets |
|
|
852 |
|
839 |
|
|
|
Total assets |
|
$ 107,406 |
|
$ 100,641 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
||
|
Accounts payable |
|
$ 1,302 |
|
$ 215 |
|
|
Accrued liabilities |
|
3,683 |
|
2,756 |
|
|
Deferred and accrued income taxes |
|
406 |
|
172 |
|
|
Deferred revenue |
|
10,761 |
|
9,694 |
|
|
|
Total current liabilities |
|
16,152 |
|
12,837 |
|
|
|
|
|
|
|
|
Note payable |
|
300 |
|
300 |
|
|
Deferred rent |
|
820 |
|
632 |
|
|
Deferred revenue |
|
622 |
|
484 |
|
|
|
Total liabilities |
|
17,894 |
|
14,253 |
|
|
|
|
|
|
|
Commitments and contingencies |
|
- |
|
- |
||
|
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|
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|
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Stockholders' equity: |
|
|
|
|
||
|
Preferred stock |
|
- |
|
- |
|
|
Common stock |
|
26 |
|
26 |
|
|
Additional paid-in capital |
|
74,627 |
|
73,600 |
|
|
Deferred compensation |
|
(19) |
|
(59) |
|
|
Retained earnings |
|
19,011 |
|
16,903 |
|
|
Accumulated other comprehensive loss (income) |
|
(33) |
|
18 |
|
|
Treasury stock |
|
(4,100) |
|
(4,100) |
|
|
|
Total stockholdersÕ equity |
|
89,512 |
|
86,388 |
|
|
Total liabilities and stockholdersÕ equity |
|
$ 107,406 |
|
$ 100,641 |
OPNET Media Contact:
Margarita Castillo
OPNET Technologies, Inc.
(240) 497-3000
Media@opnet.com
www.opnet.com
OPNET Investor Relations:
Mel Wesley
OPNET Technologies
(240) 497-3000
ir@opnet.com
www.opnet.com