Infovista . (NASDAQ:IVTA)
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PARIS, France and HERNDON, Virginia, April 26 /PRNewswire-FirstCall/ -- InfoVista (Euronext: IFV, ISIN: FR0004031649), the leading service-centric performance management software company, today announced financial results for its third quarter ended March 31, 2007.
Total revenues amounted to EUR9.6 million, a 7% decline over the same period last year. Net loss for the quarter stood at EUR 1.3 million, compared to break even in the same quarter last year.
Commenting on InfoVista's performance in the period, Alain Tingaud, Chairman & Chief Executive Officer, noted: "Our poor performance in Q3 stemmed from significant weakness in license revenues in North America, which offset a satisfactory performance in Europe and Asia. During the quarter, we took decisive steps to rectify the situation by strengthening the way in which we market ourselves to service providers and large enterprises. We also took actions to reduce costs, the benefits of which will begin to flow in Q4. I am confident in the commitment of all our employees and I am convinced that we will be updating you on our positive progress in due course."
Financial Highlights
Revenues
- Total revenues in the third quarter declined 7% to EUR9.6 million. License revenues declined by 24% year-on-year to EUR4.6 million, representing 48% of total revenues. Service revenues grew 19% to EUR5.0 million for the third quarter.
Expenses
- Gross margin in the third quarter stood at 79.9% of total revenues, compared to 80.4% in the comparable quarter of the previous year. Despite the large drop in license revenues, the decline in overall gross margin remained limited, reflecting solid margins in service activities.
- Third quarter operating expenses excluding one-off items were flat at EUR8.4 million. Research and development costs rose by nearly EUR0.2 million, while sales and marketing costs declined slightly. General and administrative (G&A) costs remained flat.
- In the third quarter, InfoVista incurred one-off charges for a total of approximately EUR0.7 million, primarily due to EUR0.5 million in severance and stock-based compensation charges related to the termination of employees, including the former CEO. During the quarter, the Company announced its decision to delist from NASDAQ, resulting in charges of approximately EUR0.2 million. Going forward, the Company expects G&A savings of nearly EUR0.3 million per quarter as a result of these measures.
- The Company had 231 employees at the end of March 2007, as compared to 219 employees a year ago.
Earnings
- In Q3, InfoVista had a net loss of EUR1.3 million, as compared to net income of EUR51 thousand in Q3 of the previous year.
Balance Sheet as of March 31, 2007
- Days Sales Outstanding (DSOs) stood at 93 days as compared to 90 days at the end of December 2006.
- Deferred revenue stood at EUR6.9 million.
- Total cash and marketable securities stood at EUR36.4 million as compared to EUR33.5 million a quarter ago. The increase in the cash position is primarily due to stock options that have been exercised during the quarter.
- The Company remains debt free.
- There were a total of 18,603,486 InfoVista shares outstanding at March 31, 2007.
Operational Highlights
Satisfactory performance in Europe and Asia offset by poor results in North America
- In America, total third quarter revenues declined by 31% year-on-year to EUR3.8 million. InfoVista sales strategy in North America was poorly executed and this was the primary reason for the year-on-year decline. During the quarter, the Company took the necessary steps by refocusing the appropriate resources on InfoVista's core business markets: service providers, MSPs and large enterprises.
- In the EMEA region, total revenues rose by 6% year-on-year to EUR4.2 million in the quarter. The Company extended its business in South Africa and Italy, and gained traction in Germany.
- In Asia Pacific, total revenues more than doubled year-on-year to EUR1.6 million in the quarter. InfoVista confirmed its leading position in Australia as it secured a EUR0.7 million win with one of the leading service providers in the region.
- EMEA, America and Asia-Pacific contributed 44%, 40% and 16%, respectively, to the third quarter's total revenues.
- Revenues from the direct sales channel totaled EUR5.8 million in the third quarter, accounting for 61% of the total. Indirect revenues, generated through partners such as Dimension Data and ONE-ANS, rose by 34% to EUR3.8 million and contributed 39% of total revenues for the quarter.
Major Wins in the Third Quarter:
- InfoVista's service provider revenues stood at EUR5.7 million for the third quarter and represented 60% of total revenues. InfoVista won new service provider accounts such as MTN and Transtel in South Africa and Sirti in Italy. The Company also received numerous repeat orders from existing customers such as Optus and AAPT in Australia and Vodafone Italy.
- InfoVista's enterprise revenues increased 83% year-on-year to EUR3.9 million in the third quarter, including EUR1.5 million from the multi-million dollar deal signed with Microsoft. During the quarter, InfoVista also secured deals from various financial institutions, including Bank of Japan, JP Morgan and Credit Agricole.
Expanding InfoVista's Research and Development
- Recently, InfoVista announced the release of VistaInsight for IP Telephony 3.0, the newest version of its award-winning performance management solution for IP telephony. The Company also announced the release of VistaWatch 2.2, the next version of InfoVista's end-to-end monitoring solution, expanding the suite's range to include Session Initiation Protocol (SIP)-based applications such as integrated instant messaging, IP voice, IP video and web-conferencing.
- Also this quarter, InfoVista announced VistaInsight(R) for Networks 2.2 Service Provider Edition, an end-to-end performance management solution with enhanced capabilities for cable providers targeting two key markets: triple play consumer and commercial services. The new solution helps Cable Multiple System Operators (MSOs) simultaneously manage competitive broadband, Voice over IP (VoIP) and digital video services to a growing number of residential and commercial customers.
Frost & Sullivan's 2006 Global Award
- InfoVista received Frost & Sullivan's 2006 Global Award for Product Differentiation Innovation and was named the market leader in this award category for the network performance management and monitoring market.
Cancellation of shares
- Following an authorization from the shareholders meeting held on December 15, 2006, the Board has decided, on April 25, 2007, to cancel 700,000 shares in treasury stock, in order to favor an accretive effect for the shareholders.
Outlook
In line with the previously announced guidance, InfoVista's management continues to expect total revenues for the year ending June 30, 2007 to be at EUR40 million with a net loss of EUR1 million. In the fourth quarter, InfoVista expects a breakeven position on total revenues of between EUR10 million to EUR10.5 million.
Conference call details
InfoVista will host an investor conference call today, Thursday 26 April 2007 at 8.30 a.m. (EST) / 1.30 p.m. (UK) / 2.30 p.m. (Continental Europe). The call will be available by dialing +33-(0)1-70-99-42-70 in France, +44- (0)20-7138-0824 in the UK, or +1-718-354-1158 in North America. A replay will be available shortly after the end of the call at the following numbers: France: +33-(0)1-71-23-02-48, UK: +44-(0)20-7806-1970, North America: +1-718- 354-1112. The replay passcode is: 8123942#. In order to ensure that a line is available for you, please register by clicking on the following link (InfoVista Q3 2006/2007)
Please note that InfoVista will be holding a SFAF meeting in Paris on the morning of June 6th 2007. Please save the date and more details will follow in due course. Thank you.
About InfoVista
InfoVista is the Service-Centric Performance Management Software Company that assures the optimal delivery of business-critical IT services. Driven by a uniquely adaptive and real-time technology foundation, InfoVista solutions improve business effectiveness, reduce operating risk, lower cost of operations, increase agility and create competitive advantage. Eighty percent of the world's largest service providers as ranked by Fortune(R), as well as leading Global 2000 enterprises, rely on InfoVista to enhance the business value of their technology assets. Representative customers include ABN AMRO, Allstream, Banques Populaires, AXA, Banque de France, Bell Canada, British Telecom, Broadwing Communications, Cable & Wireless, Com Hem, Defense Information Systems Agency (DISA), Deloitte & Touche, Deutsche Telecom, France Telecom, Savvis Corporation, SingTel, Telefonica, and US Cellular. A Software Magazine 500 company, InfoVista stock is traded on the Eurolist by Euronext (FR0004031649). For more information about the company, please visit http://www.infovista.com/.
Cautionary Remarks Regarding Forward-looking Statements: Except for information regarding historical facts, the matters discussed in this press release are "forward looking statements." These statements reflect management's beliefs and best judgment based on currently available information and expectations. However, the forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those anticipated by such forward-looking statements. In particular, statements of management's outlook assume that overall market demand for our products will remain approximately at recent levels and that we will maintain our market position despite intense competition; statements of management's outlook also do not take into account fluctuations which may occur in currency exchange rates, particularly as between the euro and the U.S. dollar. In addition, actual results may differ from those presented in the forward-looking statements due to other risks and uncertainties involved in our business, including, without limitation, the rapid evolution of our markets, our ability to attract new customers for our products, our dependence upon spending by the telecommunications industry, the technical success and reliability of our products and our ability to develop and protect new technologies. For more information regarding the factors which may affect our results and operations, see the disclosures in InfoVista's public filings with the French Autorite des Marches Financiers, including the "Risk Factors" section in our Annual Report. Undue reliance should not be placed on any forward-looking statement included in this presentation. InfoVista undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
InfoVista is a registered trademark of InfoVista, S.A.
INFOVISTA
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except for share
and per share data)
For the nine months ended For the three months
March 31, ended March 31,
2007 2006 2007 2006
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
License EUR 14,816 EUR 16,638 EUR 4,622 EUR 6,101
revenues
Service 15,325 12,690 5,019 4,218
revenues
Total revenues 30,141 29,328 9,641 10,319
Cost of revenues
Cost of 587 548 222 199
licenses
Cost of 5,196 5,255 1,717 1,822
services
Total cost of 5,783 5,803 1,939 2,021
revenues
Gross profit 24,358 23,525 7,702 8,298
Operating expenses
Sales and 13,235 13,430 4,457 4,719
marketing
expenses
Research and 5,971 5,529 2,097 1,839
development
expenses
General and 5,728 5,104 1,808 1,807
administrative
expenses
Restructuring 722 - 722 -
costs
Total operating 25,656 24,063 9,084 8,365
expenses
Operating loss (1,298) (538) (1,382) (67)
Other income
(expense):
Financial 785 477 273 209
income
Net foreign (259) (52) (189) (43)
currency
transaction
losses
(Loss) income before (772) (113) (1,298) 99
income taxes
Income tax expense (162) (205) (46) (48)
Net (loss) income EUR (934) EUR (318) EUR (1,344) EUR 51
Basic net (loss) EUR (0.05) EUR (0.02) EUR (0.07) EUR 0.00
income per share
Diluted net (loss) EUR (0.05) EUR (0.02) EUR (0.07) EUR 0.00
income per share
Basic weighted 18,085,785 17,559,998 18,309,145 17,728,965
average shares
outstanding
Diluted weighted 18,085,785 17,559,998 18,309,145 19,258,867
average shares
outstanding
INFOVISTA
CONSOLIDATED BALANCE SHEETS
(In
thousands)
As of
March 31, June 30,
2007 2006
(unaudited)
ASSETS
Cash and cash equivalents EUR 12,218 EUR 12,034
Marketable securities 24,185 26,170
Trade receivables, net 9,939 10,914
Prepaid expenses and other current assets 1,959 2,005
Total current assets 48,301 51,123
Fixed assets, net 2,260 2,109
Intangible assets, net 1,218 1,569
Investment in equity securities 1,340 1,340
Deposits and other assets 745 811
Total long-term assets 5,563 5,829
Total assets EUR 53,864 EUR 56,952
LIABILITIES & STOCKHOLDERS' EQUITY
Trade payables EUR 2,341 EUR 2,183
Accrued salaries and commissions 1,560 2,495
Accrued social security and other payroll 1,367 1,469
taxes
Deferred revenue 6,867 7,929
Accrued VAT 1,085 1,658
Other current liabilities 487 220
Total current liabilities 13,707 15,954
Other long term liabilities 163 225
Total long-term liabilities 163 225
Stockholders' equity
Common stock 11,014 10,545
Capital in excess of par value of stock 91,731 88,784
Accumulated deficit (52,603) (51,669)
Accumulated other comprehensive loss (1,523) (1,466)
Less common stock in treasury, at cost (8,625) (5,421)
Total stockholders' equity 39,994 40,773
Total liabilities and stockholders' EUR 53,864 EUR 56,952
equity
For Immediate Contact: Karena D'Arcy
Release Investor Relations Manager, InfoVista
+33-1-64-86-85-65
- or -
Kirsten Molyneux
Gavin Anderson & Company
+44-(0)207-554-1400
DATASOURCE: Infovista
CONTACT: Contact: Karena D'Arcy, Investor Relations Manager, InfoVista,
+33-1-64-86-85-65, , or Kirsten Molyneux, Gavin Anderson
& Company, +44-(0)207-554-1400,