Network Diagramming Channel Feature

Network Diagramming Solutions Provider OPNET Reports Third Quarter Results

By Carrie Schmelkin
TMCnet Web Editor

OPNET Technologies (News - Alert) has certainly been feeling a bit rosy as of late and it’s not just because Cupid will be arriving tomorrow for Valentine’s Day.

Last week, the network diagramming solutions provider shared that revenue for the third fiscal quarter, ended Dec. 31, 2011, was $46 million, compared to $39.7 million for the same quarter in the prior fiscal year. Other stats were that diluted earnings per share for the third quarter of fiscal 2012 were $0.23, compared to $0.19 for the same quarter in the prior fiscal year. Moreover, OPNET reported a quarterly dividend of $0.12 per share, which represents one quarter of the company's fiscal 2012 annual dividend target of $0.48, payable on March 28, 2012 to stockholders of record as of the close of business on March 14, 2012.

“We are very pleased to report strong financial performance, and a third consecutive quarter of record operating income,” Marc A. Cohen, OPNET’s chairman and CEO, said in a statement. “We also achieved records in product revenue and maintenance revenue, which allowed us to increase our operating income 48 percent over the same quarter last fiscal year. In addition to achieving total record revenue, we increased our deferred revenue $5.7 million from last quarter. Our performance was driven by year over year growth in revenue from corporate enterprise customers. Our strong quarterly performance allowed us to further expand our operating margin to 18 percent.”

“Our core APM (News - Alert) business continued to drive performance, and accounted for 81 percent of our total product bookings during the quarter,” Cohen added. “APM product sales increased 33 percent over the same quarter last year. We believe that the growth in APM is being driven both by superior analytics and by our end-to-end solutions that span applications, systems and networks.”

According to company officials, during the third quarter of fiscal 2012, total revenue for the quarter increased sequentially 9.7 percent from $41.9 million for the second quarter of fiscal 2012.

Moreover, product revenue increased year-over-year by 21.1 percent to $24.4 million from $20.2 million for the same quarter of fiscal 2011. Product revenue for the quarter increased sequentially 18.6 percent from $20.6 million for the second quarter of fiscal 2012.

Other highlights of the earnings report are that: deferred revenue increased year-over-year by 16.1 percent to $49.8 million from $42.9 million at the end of the same quarter of fiscal 2011; gross margin decreased year-over-year to 77.3 percent from 78.8 percent for the same quarter of fiscal 2011; and diluted net income per common share increased year-over-year to $0.23 from $0.19 for the same quarter of fiscal 2011.

With regards to non-GAAP financial highlights: non-GAAP gross margin decreased year-over-year to 78.6 percent from 80.3 percent for the same quarter of fiscal 2011; non-GAAP operating margin increased year-over-year to 20.8 percent from 17.3 percent for the same quarter of fiscal 2011; and non-GAAP diluted net income per common share increased year-over-year to $0.26 from $0.23 for the same quarter of fiscal 2011.

Looking ahead to the fourth quarter, the network diagramming solutions provider noted that it expects its fourth quarter GAAP revenue to be between $45 million and $49 million, and GAAP diluted net income per common share to be between $0.17 and $0.29 and non-GAAP diluted net income per common share to be between $0.20 and $0.32.

OPNET currently expects fiscal 2012 GAAP revenue to be between $173 million and $177 million, and GAAP diluted net income per common share to be between $0.79 and $0.91 and non-GAAP diluted net income per common share to be between $0.92 and $1.04.

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