[ACCESSWIRE]
LONDON, UK / ACCESSWIRE / October 3, 2016 / Active Wall St. announces its post-earnings coverage on Progress Software Corporation (NASDAQ: PRGS). The company released its financial results for the third quarter fiscal 2016 (Q3 FY16) on September 28, 2016. The Bedford, Massachusetts-based company recorded an 8% y-o-y growth in its GAAP revenue and non-GAAP EPS during the reported quarter. Register with us now for your free membership at: http://www.activewallst.com/register/.
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Earnings Reviewed
During the three months ended on August 31, 2016, Progress Software reported GAAP revenue of $102.02 million compared to $94.64 million recorded at the end of Q3 FY15. The market had expected the company to report total revenue of $104.7 million. The company attributed this revenue growth to improved maintenance and services revenue from both OpenEdge and Telerik businesses.
The application software developer reported GAAP net income of $7.58 million, or $0.15 per diluted share, in Q3 FY16 compared to a GAAP net loss of $4.13 million, or $0.08 loss per diluted share, in Q3 FY15. The company's Q3 FY15 earnings included acquisition related cost of Telerik acquired on December 02, 2014.
Adjusted net income improved to $21.63 million, or $0.44 per diluted share, in Q3 FY16 from $20.02 million, or $0.39 per diluted share. Adjusted net income numbers for FY16 fell short of market expectation of $0.45 per diluted share.
Operating-Metrics
In the reported quarter, Progress Software's GAAP gross profit came in at $84.83 million, up 7% on y-o-y basis. The company's GAAP operating income surged 58% y-o-y to $13.61 million in Q3 FY16. GAAP operating margin for Q3 FY17 came in at 13% of GAAP revenues versus 9% of GAAP revenues in the year ago comparable period. Additionally, the company recorded daily sales outstanding of 49 days in Q3 FY16 compared to 54 days in Q3 FY15.
Segment-wise
The company's OpenEdge segment revenues fell declined 8% y-o-y in Q3 FY16 to $67.53 million. The segment contribution for the reported quarter came in at $49.35 million, down 10% y-o-y from $54,848 million in Q3 FY15.
The Data Connectivity and Integration segment revenues surged 72% to $14.25 million in Q3 FY16. Furthermore, the segment's contribution in Q3 FY16 was $11.42 million versus $5.10 million in the year ago period.
Progress Software's Application Development and Deployment segment reported a 56% y-o-y growth in revenue to $20.23 million in Q3 FY17.
Regional Contribution
During the reported quarter, revenues from North America were $58.28 million compared to $49.81 million in Q3 FY15. Revenues from Europe, Middle East, and Africa regions grew from $30.66 million in Q3 FY15 to $32.72 million in Q3 FY16. Furthermore, revenues from Latin America revenues improved marginally to $4.67 million in Q3 FY16 from $4.62 million in Q3 FY15. However, Asia/Pacific region's revenue declined to $6.36 million during Q3 FY16 from $9.55 million in the year ago period.
Cash Flow & Balance Sheet
During Q3 FY16, Progress's cash flow from operation improved to $19.65 million from $19.26 million in the previous year's comparable quarter. At the close of books on August 31, 2016, Progress Software had $232.68 million in cash, cash equivalents, and short-term investments compared to $241.28 million at the close of books on November 30, 2015. Additionally, the company's long-term debt decreased to $123.75 million as on August 31, 2016 from $135.00 million as on November 30, 2015.
Stock Repurchase
In Q3 FY16, the company bought back 0.4 million shares for $11.5 million under its previously announced share repurchase program of $200 million.
In a separate announcement on September 28, 2016, the company announced debut of its quarterly cash dividend. The Board of Directors declared first quarterly dividend of $0.125 per share of common stock, payable on December 15, 2016 to shareholders of record as of the close of business on December 01, 2016.
Earnings Guidance
In its guidance for full year FY16, Progress Software expects GAAP revenue to be in the range of $410 million to $413 million. For the year ending November 30, 2016, the company's management forecasted GAAP diluted earnings per share to be in the range of $0.61 to $0.63. Furthermore, the projected GAAP diluted earnings per share for Q4 FY16 is expected to lie between $0.25 and $0.28 as GAAP revenues is anticipated to be in the range of $122 million to $125 million.
Stock Performance
At the closing bell, on Friday, September 30, 2016, Progress Software's stock marginally fell by 0.04%, ending the trading session at $27.20. A total volume of 519.73 thousand shares were traded at the end of the day, which was higher than the 3-month average volume of 228.41 thousand shares. In the last six month and previous twelve months, shares of the company have advanced 8.89% and 6.13%, respectively. Moreover, the stock gained 13.33% since the start of the year.
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