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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Walter High who wrote (10331)	6/17/1998 9:29:00 AM
From: Jenna	Read Replies (1) \| Respond to of 120523

PRGS Reports Second Quarter Results and Three-For-Two Stock Split +3 1/8 at open...still climbing. Company's Growth Fueled by High Demand for Packaged Software Applications BEDFORD, Mass.--(BUSINESS WIRE)--June 17, 1998--Progress Software Corporation (NASDAQ:PRGS - news), a leading supplier of application development tools, database technology and support services for business applications, announced today record revenue for the second quarter ended May 31, 1998. Revenue for the quarter increased 27 percent to $57.1 million, up from $44.8 million in the same quarter last year. Operating income for the second quarter of 1998 was $5.9 million and net income was $4.7 million, up from $1.4 million and $2.0 million, respectively, in the second quarter of 1997. Diluted earnings per share of $0.36 represented an increase of 125 percent over the $0.16 achieved in the same period last year. Progress Software also announced its board of directors has approved a three-for-two stock split that will be effected as a 50 percent stock dividend. Shareholders of record on June 29, 1998 will be entitled to one additional share for every two shares held on that date. The distribution date will be July 13, 1998. For the six months ended May 31, 1998, revenue increased 23 percent to $111.3 million from $90.2 million in 1997. Operating income increased 202 percent to $10.8 million from $3.6 million in 1997. Net income increased 104 percent to $8.2 million from $4.0 million in 1997 and diluted earnings per share increased 110 percent to $0.65 from $0.31 in 1997. The company's revenue in the second quarter and first six months was adversely affected by the strengthening of the U.S. dollar during 1998 as compared to 1997. On a constant currency basis, revenue in the second quarter grew by 31 percent as compared to the second quarter of 1997. On a constant currency basis, revenue in the first six months of 1998 grew by 28 percent as compared to the first six months of 1997. During the second quarter, Progress Software purchased 264,342 shares of its stock at a cost of $8.4 million. Since beginning its share buybacks in the first quarter of 1996, the company has purchased approximately 2.8 million shares of its common stock at an average price of $18.78. The company's cash and short-term investments at the end of the second quarter totaled $96.3 million. The company's accounts receivable days sales outstanding was 58 days at the end of the second quarter of 1998 as compared to 62 days a year ago. The surge in demand for packaged software helped fuel revenue growth during the quarter, according to Joseph W. Alsop, president of Progress Software. ''Industry analysts such as IDC estimate that the size of the packaged applications market will more than double by the year 2002, and Progress Software is in an ideal position to take advantage of that growth. Our primary selling model is to partner with application providers and deliver the technology they need to build packaged solutions that are fast, easy to install and inexpensive to maintain. Mid-sized businesses in particular are rapidly adopting these partner-built applications which, combined with our application development tools, offer a 'buy-build-both' approach to rapidly implementing customized business solutions.'' In The Quarter During the second quarter, Progress Software made several significant announcements. In May, the company began shipping the latest version of its popular application server and development tool for Java, Apptivity(TM) 2.1. Apptivity has garnered extremely favorable reviews in the press, and this version incorporates a number of new features, such as firewall tunneling, that make it an excellent choice for companies that want to create mission-critical business applications for Internet environments. The company also announced that its Apptivity product will be the first Java business application development and deployment tool to support the Enterprise JavaBeans 1.0 specification. This Sun Microsystems' technology standard will make it easier for Apptivity users to create, deploy and manage large-scale Java business applications, consisting of JavaBeans distributed across clients and servers, within the framework of their existing systems. In March, Progress Software appointed Scott McGregor to its Board of Directors. Mr. McGregor is currently senior vice president and general manager of the Emerging Business Unit for Philips Semiconductors, and is responsible for directing that company's innovative product groups.