Progre Software Reports 06 Fiscal First Quarter Results

March 30, 2016

Progress Software Reports 2016 Fiscal First Quarter Results BEDFORD, Mass.--(BUSINESS WIRE)-- Progress (NASDAQ: PRGS), a global software company that simplifies and enables the development, deployment and management of business applications, today announced results for its fiscal first quarter ended February 29, 2016.

Revenue was $89.5 million compared to $81.4 million in the same quarter last year, a year over year increase of 10% on an actual currency basis and 14% on a constant currency basis. On a non-GAAP basis, revenue was $90.2 million compared to $95.5 million in the same quarter last year, a decrease of 5% on an actual currency basis and 2% on a constant currency basis.

Additional financial highlights included:

On a GAAP basis in the fiscal first quarter of 2016:

Revenue was $89.5 million compared to $81.4 million in the same quarter in fiscal year 2015;

Income from operations was $6.7 million compared to a loss from operations of $11.2 million in the same quarter last year;

Net income was $3.2 million compared to a net loss of $1.0 million in the same quarter last year;

Diluted earnings per share was $0.06 compared to a loss per share of $0.02 in the same quarter last year; and

Cash from operations was $22.5 million compared to $37.1 million in the same quarter last year.

On a non-GAAP basis in the fiscal first quarter of 2016:

Revenue was $90.2 million compared to $95.5 million in the same quarter last year;

Income from operations was $21.5 million compared to $20.4 million in the same quarter last year;

Operating margin was 24% compared to 21% in the same quarter last year;

Net income was $13.8 million compared to $15.1 million in the same quarter last year;

Diluted earnings per share was $0.27 compared to $0.29 in the same quarter last year; and

Adjusted free cash flow was $22.7 million compared to $35.9 million in the same quarter last year.

Phil Pead, President and CEO of Progress, said, While our first quarter revenue fell slightly short of our expectations, we remain confident in our strategy and capabilities, and in the value that our products provide to our customers and partners. We continue to see significant opportunities in the marketplace for our technologies, and remain committed to creating shareholder value, and achieving our goal of becoming the preferred destination for application developers.

Other fiscal first quarter 2016 metrics and recent results included:

Cash, cash equivalents and short-term investments were $251.5 million;

DSO was 59 days, compared to 56 days in the fiscal first quarter of 2015; and

Under the previously announced authorization by the Board of Directors to repurchase up to $100 million of shares of common stock, Progress repurchased 0.5 million shares for $11.7 million during the fiscal first quarter of 2016.

Business Outlook

Progress fiscal 2016 financial guidance is based on current exchange rates. The negative currency translation impact on Progress fiscal year 2016 business outlook compared to 2015 exchange rates is unchanged at approximately $7.0 million on non-GAAP revenue and $0.02 to $0.03 on non-GAAP earnings per share. The negative currency translation impact on Progress fiscal Q2 2016 business outlook compared to 2015 exchange rates is approximately $1.0 million to $2.0 million on non-GAAP revenue and $0.01 to $0.02 on non-GAAP earnings per share. To the extent that there are further changes in exchange rates versus the current environment, this may have an additional impact on Progress business outlook.

Progress Software provides the following revised guidance for the fiscal year ending November 30, 2016:

Non-GAAP revenue is expected to be between $414 million and $420 million (previously $427-$433 million);

Non-GAAP earnings per share is expected to be between $1.57 and $1.63 (previously $1.59-$1.65);

Non-GAAP operating margin is expected to be approximately 29% (previously 29%-30%);

Adjusted free cash flow is expected to be between $80 million and $85 million (previously $97-$102 million); and

Non-GAAP effective tax rate is expected to be approximately 33% (unchanged).

Progress Software provides the following guidance for the second fiscal quarter ending May 31, 2016:

Non-GAAP revenue is expected to be between $93 million and $96 million; and

Non-GAAP earnings per share is expected to be between $0.26 and $0.29.

Share Repurchase Program

Progress also announced today that its Board of Directors has authorized a new $100 million share repurchase program, increasing the total authorization to $203 million. Progress intent is to utilize the full amount of this authorization by the end of this fiscal year, and will provide updates each quarter on any repurchase activity.

Conference Call

The Progress quarterly investor conference call to review its fiscal first quarter of 2016 will be broadcast live at 5:00 p.m. ET on Wednesday, March 30, 2016 and can be accessed on the investor relations section of the companys website, located at www.progress.com. Additionally, you can listen to the call by telephone by dialing 1-877-545-1407, pass code 8077674. The conference call will include brief comments followed by questions and answers. An archived version of the conference call and supporting materials will be available on the Progress website within the investor relations section after the live conference call.

Legal Notice Regarding Non-GAAP Financial Information

Progress provides non-GAAP financial information as additional information for investors. These non-GAAP measures are not in accordance with, or an alternative to, generally accepted accounting principles in the United States (GAAP). Progress believes that the non-GAAP results described in this release are useful for an understanding of its ongoing operations and provide additional det

LINK:	http://investors.progress.com/releasedetail.cfm?ReleaseID=962793...
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