OPNET Reports Record Revenue
and Operating Margin for Fiscal Q3 2004
- Record revenue of $14.4 million
- Record operating margin of 14.8%
- Record deferred revenue of $12.3 million
- Operating cash flow of $4.0 million
BETHESDA, MD - January 28, 2004 -- OPNET Technologies, Inc. (NASDAQ: OPNT), a leading provider of management software for networks and applications, today announced financial results for its third fiscal quarter ended December 31, 2003. Revenue for the quarter ended December 31, 2003 was $14.4 million compared to $11.8 million for the same quarter in the prior year. Earnings per share for the third quarter of fiscal 2004 was $0.08 on a diluted basis, compared to $0.04 in the same quarter of the prior year.
For the nine months ended December 31, 2003 and 2002, revenues were $40.1 million and $34.1 million, respectively. Earnings per share for the nine months ended December 31, 2003 was $0.18 on a diluted basis, compared to $0.09 in the comparable period ended December 31, 2002.
OPNET Chairman & CEO, Marc A. Cohen, stated, “We are extremely pleased to report a consecutive record-breaking quarter across key metrics, including revenue, operating income, operating margins, diluted earnings per share, and deferred revenue. The significant operating leverage of our business model is allowing us to continue investing in revenue-generating staff as part of our strategy for long-term growth, while generating improvements in financial performance.”
Fourth Quarter Fiscal Year 2004 Financial
Outlook
OPNET expects fiscal fourth quarter revenue to be between $15.0
and $15.5 million and diluted earnings to be between 7 and 9 cents
per share. These amounts represent management’s current
expectations about the Company’s future financial performance,
based on information available at this time.
- Grew revenue year over year 22.3% to a record $14.4 million from $11.8 million in revenue for the third quarter of fiscal 2003. Revenue for the quarter grew sequentially 7.7% from $13.4 million for the second quarter of fiscal 2004.
- Expanded operating margins sequentially from 14.3% to 14.8% in the third quarter of fiscal 2004 resulting in record operating income of $2.1 million.
- Maintained a strong balance sheet with $78.6 million in cash and marketable securities at December 31, 2003.
- Reduced DSOs 19 days from September 30, 2003 to 57 days as of December 31, 2003.
- Increased deferred revenues to a record $12.3 million from $11.4 million at the end of the second quarter of fiscal 2004.
The Company will hold an investor conference call on Wednesday, January 28, 2004 at 5:00 pm Eastern Time to review financial results for the third 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 ONT 284, 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 #89976. The replay will be available from 7:00 pm Eastern Time January 28th through 11:59 pm Eastern Time January 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.
Note to editors: The word OPNET is spelled with all upper-case letters.
OPNET Technologies,
Inc. Condensed Consolidated Statements of Operations
(unaudited)
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Three Months Ended |
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Nine Months Ended |
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December 31, |
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December 31, |
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2003 |
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2002 |
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2003 |
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2002 |
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(in thousands, except per share data) |
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Revenues: |
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New software licenses |
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$ 7,113 |
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$ 5,594 |
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$ 19,987 |
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$ 15,833 |
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Software license updates and technical support |
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3,940 |
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3,244 |
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10,907 |
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9,370 |
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Professional services |
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3,379 |
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2,966 |
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9,244 |
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8,866 |
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Total revenues |
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14,432 |
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11,804 |
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40,138 |
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34,069 |
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Cost of revenues: |
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New software licenses |
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126 |
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205 |
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614 |
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585 |
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Software license updates and technical support |
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445 |
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379 |
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1,188 |
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1,283 |
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Professional services |
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2,048 |
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1,192 |
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5,302 |
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3,472 |
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Amortization of acquired technology |
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125 |
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126 |
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375 |
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377 |
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Total cost of revenues |
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2,744 |
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1,902 |
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7,479 |
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5,717 |
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Gross profit |
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11,688 |
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9,902 |
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32,659 |
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28,352 |
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Operating expenses: |
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Research and development |
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3,144 |
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3,200 |
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9,450 |
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9,575 |
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Sales and marketing |
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4,964 |
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4,530 |
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14,044 |
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13,500 |
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General and administrative |
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1,438 |
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1,251 |
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4,208 |
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3,619 |
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Total operating expenses |
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9,546 |
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8,981 |
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27,702 |
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26,694 |
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Income from operations |
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2,142 |
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921 |
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4,957 |
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1,658 |
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Interest and other income, net |
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135 |
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192 |
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436 |
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716 |
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Income before provision for income taxes |
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2,277 |
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1,113 |
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5,393 |
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2,374 |
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Provision for income taxes |
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658 |
|
279 |
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1,666 |
|
595 |
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Net income |
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$ 1,619 |
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$ 834 |
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$ 3,727 |
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$ 1,779 |
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Basic net income per common share |
$ 0.08 |
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$ 0.04 |
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$ 0.19 |
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$ 0.09 |
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Diluted net income per common share |
$ 0.08 |
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$ 0.04 |
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$ 0.18 |
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$ 0.09 |
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Basic weighted average common shares outstanding |
19,759 |
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19,299 |
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19,605 |
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19,242 |
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Diluted weighted average common shares outstanding |
20,906 |
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20,046 |
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20,489 |
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19,940 |
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OPNET Technologies,
Inc. Condensed Consolidated Balance Sheets
(unaudited)
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December 31, |
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March 31, |
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2003 |
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2003 |
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ASSETS |
(in thousands) |
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Current assets: |
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Cash and cash equivalents |
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$ 33,937 |
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$ 70,251 |
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Marketable securities |
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44,622 |
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- |
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Total cash and marketable securities |
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78,559 |
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70,251 |
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Accounts receivable, net |
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6,871 |
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6,420 |
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Unbilled accounts receivable |
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2,090 |
|
933 |
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Prepaid expenses and other current assets |
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2,106 |
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1,412 |
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Total current assets |
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89,626 |
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79,016 |
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Property and equipment, net |
6,425 |
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7,008 |
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Intangible assets, net |
1,370 |
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1,566 |
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Goodwill |
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12,212 |
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12,212 |
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Other assets |
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1,561 |
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839 |
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Total assets |
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$ 111,194 |
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$ 100,641 |
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LIABILITIES AND STOCKHOLDERS' EQUITY |
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