Portal Software continues to impress with strong 2Q

Portal Software Inc. (Nasdaq: PRSF) walloped First Call's estimated loss of 14 cents a share for its second quarter, losing only a penny a share on revenue that increased 385 percent over the 1998's second quarter.

Shares closed at 44 5/8 Thursday, below their high of 59 15/16. The maker of software for billing and registering Internet users is among the top 20 IPOs of the year. Shares gained 219 percent in their debut, and got a boost from Cisco investments in mid-May. The company also reported a strong first quarter.

Revenue for the second quarter ended July 31 was $20.8 million, a 385 percentage increase over revenue of $4.3 million for 1998's second quarter. Of Portal's sales total, licensing fees represented $12.6 million with services being the remainder. Net loss for the quarter was $800,000, or 1 cent a share, compared to a net loss of $4.5 million, or 16 cents a share, in the year earlier period.

Portal Software said the movement of products into new vertical markets, closing deals with communications service providers, results from key alliances and the shipment of new technology on schedule contributed to its strong financial results.

The company expanded its customer management and billing software into three new vertical markets: free services, online content and branded Internet access. The company also closed several deals, including NatWest Group for its Magex financial clearinghouse for digital music and established a strategic relationship with InterTrust Technologies.

Portal also moved into the ISP market by inking a Pan-European agreement with ICL, the leading IT services company in Europe. In conjunction with Cisco Systems, Hewlett Packard and KPMG, Portal also closed a major deal with Qwest Communications.