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Progress Reports Q3 Results

Progress Software (NASDAQ:PRGS), an infrastructure independent software vendor (ISV), announced today that its third quarter revenue was $66.7 million, up from $65.4 million for the same quarter last year. The two percent increase is for the three-month period that ended on August 31, 2001.

However, while total revenue was up, both operating income and net income were down compared to the third quarter of 2000. Operating income was $6.1 million, down 14 percent from last year Net income was down 29 percent, from $6.9 million in 2000 to $4.9 million for the third quarter of this year.

According to a company-released financial statement, year-to-date revenue is down 6 percent from the first nine months of fiscal year 2000 (from $204.9 million last year to 192.7 million this year).

However, on a quarter-to-quarter basis, the Bedford, Mass-based company did show a sequential increase over the second quarter of 2001, which closed at $65.7 million. Its first quarter ended at $60.2 million.

"We have achieved sequential and year-over-year revenue growth during this challenging time in the global economy," Joseph Alsop, CEO of Progress Software said. "With Sonic Software's continued growth, the expansion of our ASPen Program through the acquisition of Allegrix, and the Progress Company's OpenEdge integrated e-Business Platform, we are enthusiastic about the strategic direction of each of our operating companies."

During a conference call today, the company reported that it has adjusted its fourth quarter projections based on the events of last week. Given its sequential growth over the first three quarters, the company reported it was previously looking for continued growth in Q4. However, it has adjusted its projections to reflect revenues that are around what the company experienced in the Q3.

Progress Software also reported that its board of directors authorized the repurchase of up to 10 million shares of outstanding common stock starting October 1, 2001, at such times when the company deems such purchases to be an effective use of cash. The company's existing repurchase authorization, under which 8.9 million shares remain available for repurchase, expires on September 30, 2001.

During the third quarter, the company purchased 22,000 shares of its stock at a cost of approximately $300,000. Since beginning its share buy-back program in the first quarter of 1996, the company has purchased approximately 13.3 million shares of its common stock at a cost of $118 million.

In June, Progress acquired Santa Clara, Calif.-based application infrastructure provider (AIP) Allegrix, headquartered in Santa Clara, Calif. Progress added Allegrix's hosting, empowerment and education services for independent software vendors to its ASPen ASP enablement program. (see Progress Marches On).

Last month, Progress announced it was expanding its ASPen program to include managed services (see Progress Doesn't Stand Still).

Progress Software is an ASPnews Top 20 Infrastructure Provider company.