Application serving and portal software developer Citrix Systems Inc. Tuesday reported positive results for the fifth consecutive quarter, coming in with earnings at $0.21 a share, beating analyst estimates by $0.02.
“We are pleased that we were able to post our fifth consecutive quarter of positive results, especially given the economic uncertainty that remains in the marketplace,” said Mark B. Templeton, Citrix president and CEO. “The market has been very receptive to Citrix products and solutions in this environment, demonstrated in the accelerated shift to our MetaFrame XP platform, which accounted for almost two-thirds of our base product sold in the Americas this quarter. This rapid adoption of our new technology demonstrates Citrix’s ability to provide effective solutions to our customers even in tough economic times.”
Net revenues for the third quarter ended September 30, 2001, were $153.5 million, up 35.2% from $113.5 million in the comparable period of the prior year. Net income was $27.8 million for the third quarter of 2001, or $0.14 per share, as compared to $21.6 million, or $0.11 per share, in the comparable period of the prior year. Net income, adjusted to exclude the effect of amortization of intangible assets relating to business combinations, was $41.4 million for the third quarter, or $0.21 per share, as compared to $27.5 million, or $0.14 per share, in the comparable period of the prior year.
For the first nine months of 2001, net revenues were $433.6 million, up 24.9% from $347.1 million for the comparable nine months of 2000. Net income for the first nine months of 2001 was $79.6 million, or $0.41 per share, as compared with net income of $75.1 million, or $0.37 per share, for the comparable nine months of 2000. Net income, adjusted to exclude the effects of write-offs for in-process research and development and amortization of intangible assets relating to business combinations, was $112.0 million, or $0.57 per share, for the first nine months of 2001, as compared to $92.2 million, or $0.46 per share, in the same period last year.
FINANCIAL HIGHLIGHTS
— The company reported comparable quarterly year-over-year revenue growth of 35.2%.
— International revenue was 47% vs. domestic revenue of 53% for the quarter.
— Electronic delivery of licenses this quarter amounted to 29% of product sales.
— Operating margin, excluding the effect of amortization of intangible assets relating to business combinations, was 30.8% for the quarter.
— Cash flow from operations was approximately $53.0 million for the quarter.
— The company repurchased approximately 1.87 million shares of its common stock during the quarter.
— Cash and investments totaled $750.1 million at the end of the quarter.
CUSTOMER WINS
“Citrix continued to grow its electronic licensing business, which accounted for approximately 29% of product sales during the quarter, the biggest electronic licensing quarter since the program began,” commented John Burris, Citrix’s senior vice president of worldwide sales and services. “With electronic licensing, customers are finding it easier to work with Citrix as ordering product and receiving delivery are much more efficient and timely, meeting partner and customer needs.”
Significant customer agreements during the quarter included American Express, AOK Sachsen, Career Education Corporation, Cegelec S/A, Centura Health, Crane Group, Ericsson, IKEA, Nationwide Insurance, Qwest, the State of Oregon and Telkom S/A.
“This quarter, we saw more medium and large customers ordering product from Citrix as they continued to expand their internal deployments. We believe our customers continue to spend on products that provide a quick payback and decrease internal expenses,” continued Burris. “As IT organizations move to a more efficient, centralized model of deploying applications, we are delivering solutions that help these organizations save costs, leverage their existing investments, and achieve a substantial ROI on their new investments.”
OTHER HIGHLIGHTS
— Citrix responded to the immediate needs of the American Red Cross by supplying software, server support, and Citrix engineers to support the relief effort in New York. Citrix also donated a quarter of a million dollars to the Uniformed Firefighters Association Widow’s and Children’s Fund and the New York City Patrolmen’s Benevolent Association.
— The Citrix Consulting Services organization and sales team have been proactive in serving customers and resellers whose environments were severely impacted as a result of the September 11 tragedy.
STRATEGIC RELATIONSHIPS, ALLIANCES, & COMPANY AWARDS
— Citrix won Computerweek’s “Best of Breed 2001” award as IT managers rated Citrix the top brand in the category of server-based computing / thin-client software.
— Citrix announced support for Microsoft’s .Net initiative through an agreement with Microsoft enabling Citrix to leverage Microsoft SharePoint Portal Server functionality with Citrix XPS portal software. Citrix also joined Microsoft’s SharePoint Developer Community Partner Program.
— Citrix announced alliances with eRoom and SiteScape, giving Citrix XPS portal customers enhanced collaboration capabilities to advance business processes and communications regardless of geographic or organizational boundaries. Sitescape and eRoom have both joined the Citrix Business Alliance Internet Solutions Program to expand joint sales and marketing opportunities.
— Citrix announced alliances with Documentum and Interwoven, bringing content management functionality and infrastructure services to portal customers and users across the enterprise. These features will give portal customers and users the ability to access, create, manage and deploy enterprise Web content in any format, enhancing productivity and collaboration in the workflow process. Documentum and Interwoven have both joined the Citrix Business Alliance Internet Solutions Program to expand joint sales and marketing opportunities.
— Citrix and Entrust teamed up to enable enhanced security for remote access and server-based applications, allowing Entrust-secured applications to be rolled out quickly and easily on a mass scale. The relationship demonstrates the commitment of both companies to securely deliver Internet applications with enhanced security that includes identification, privacy, verification, and security management.
