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Progress beats 4Q expectations, announces stock split

Progress Software Corporation (Nasdaq: PRGS) said Friday its net income for the fourth quarter was 60 cents a share, a nickel above First Call's expectation of 55 cents a share.

The maker of application development and management software also announced a stock split.

Shares jumped 9 1/2 to 54 7/8 in morning trading Friday, and have been rising since the company jetted past expectations in its second quarter.

Revenue for the quarter increased 13 percent to $78.1 million, up from $69.2 million in the same quarter last year. Operating income was $16 million and net income was $11.8 million, up from $11.3 million and $8.4 million, respectively, in the same quarter last year. Diluted earnings of 60 cents a share were up 40 percent over the 43 cents a share achieved in the fourth quarter of 1998. Progress Software said the good results have come with the recent boom in the emerging application service provider (ASP) market, which has given it several hundred new sales partners.

Progress Software said it had approved a 2-for-1 stock split for shareholders of Jan. 7 record. The distribution date will be January 21, 2000.

For the year ended Nov. 30, 1999, Progress revenue increased 19 percent to $286.1 million from $239.9 million in 1998. Net income increased 54 percent to $35 million from $22.8 million in 1998 and diluted earnings per share increased 51 percent to $1.78 from $1.18 in 1998. First Call's annual estimate had been $1.73 a share.

The company said revenue was hurt by the strengthening of the U.S. dollar. On a constant currency basis, revenue in the fourth quarter grew 19 percent from the same period a year ago. On a constant currency basis, revenue for the full fiscal year grew 23 percent over fiscal 1998.

Progress spent $1 million to buy back about 33,000 shares in the fourth quarter.