July 21, 1999-\226Legato Systems, Inc. (NASDAQ: LGTO - news), the leader
in enterprise storage management, today announced record financial results for its second quarter of 1999. Also during the
quarter, the Company successfully completed the acquisitions of FullTime Software, Inc. and Intelliguard Software, Inc.
The company achieved record revenue of $62.0 million, representing an increase of 65% over last year's second quarter
revenue of $37.5 million. Net income, excluding merger related costs, increased 242% to $12.5 million, from $3.7 million in
the same fiscal period of 1998. Diluted earnings per share, on the same basis, increased 222% to $0.29 over the $0.09 earned
in the second quarter of last year. All prior period amounts have been restated to include the results of FullTime Software,
which was accounted for as a pooling of interests.
On an as-reported basis, diluted earnings per share for the second quarter of 1999 were $0.10, including $4.2 million of
purchase accounting amortization and $8.1 million of one-time merger-related expenses.
''I am extremely pleased with this quarter's performance in all respects,'' commented Louis C. Cole, Legato's president and
chief executive officer. ''Our second quarter results are a direct reflection of the strong momentum we are seeing in our
business as customers continue to demand fully-integrated software solutions to support their complex storage environments.
Equally impressive are the major efforts that have been made by all of our employees to successfully integrate three leading
companies into a major force in the data protection and data availability markets,'' concluded Cole.
''Our recently completed second quarter was our strongest quarter in company history,'' commented Stephen C. Wise, chief
financial officer. ''License revenue of $46.2 million for the quarter grew nearly 60% over the second quarter of last year.
Service and support revenue of $15.8 million was up sharply as well, reflecting increased customer demand for consulting,
education, and maintenance and support contracts. We're very pleased with the success we're having in all of our markets
worldwide and with the contributions from our newly added businesses,'' concluded Wise.
In a separately released communication, the company also announced a 2:1 stock split, to be effected in the form of a stock
dividend, effective as of August 16, 1999.
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