OPNET Reports Results for Fiscal Q2 2005
Revenue of $14.2 Million and EPS of $0.02
BETHESDA, MD - October 28, 2004 --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, 2004. Revenue for the quarter ended September 30, 2004 was $14.2 million compared to $13.4 million for the same quarter in the prior year. Earnings per share for the second quarter of fiscal 2005 was $0.02 on a diluted basis, compared to $0.07 in the same quarter of the prior year.
For the six months ended September 30, 2004 and 2003, revenues were $31.0 million and $25.7 million, respectively. Earnings per share for the six months ended September 30, 2004 was $0.12 on a diluted basis, compared to $0.10 for the six months ended September 30, 2003.
OPNET Chairman & CEO, Marc A. Cohen, stated, "After achieving record quarterly revenue, operating margins, and earnings over the previous four quarters, our Q2 results came in below plan. Although we had set expectations for a sequential decline in our revenue, our analysis indicates that we encountered more deals with longer transaction processing in corporate enterprise, service provider, and government accounts than in previous quarters. A 29% sequential decline in license revenue produced a 3% operating margin this quarter, compared to the 17% produced last quarter. We currently expect sequentially better revenue in Q3, based on our revenue visibility entering the quarter, including the delayed deals from Q2. However, we also expect higher operating spending in Q3, including approximately $600,000 from the acquisition of Altaworks and approximately $400,000 from our Sarbanes-Oxley Section 404 compliance efforts."
Mr. Cohen added, "We are focused on customer acquisition, new products, and internal productivity as a foundation for sustainable growth. We remain confident in our staff, our products, and our market opportunity."
Third Quarter Fiscal Year 2005 Financial Outlook
OPNET expects fiscal third quarter revenue to be between $15.0 and $15.5 million and diluted earnings to be between breakeven and 3 cents per share. These amounts represent management’s current expectations about the Company’s future financial performance, based on information available at this time.
The Company will hold an investor conference call on Thursday, October 28, 2004 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 877-407-9205 in the U.S. or 201-689-8054 for international callers, 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 # 119287. The replay will be available from 7:00 pm Eastern Time October 28th through 11:59 pm Eastern Time November 1st. 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, fluctuations in customer demand, the length and variability of our sales cycle, and risks regarding our ability to successfully expand our sales force.
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Note to editors: The word OPNET is spelled with all upper-case letters.
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