Progress Software beats estimates, splits stock

The application development tool maker posts fourth-quarter earnings 5 cents above analysts' estimates and announces a 2-for-1 stock split.

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Progress Software today posted fourth-quarter earnings 5 cents above analysts' estimates and announced a 2-for-1 stock split.

The Bedford, Mass.-based company said fourth-quarter net income was $11.8 million, or 60 cents a share, an increase from $8.4 million, or 43 cents, in the same period a year ago. Analysts polled by First Call projected the company to earn 55 cents a share for the quarter.

Progress, which makes application development tools, also said its board of directors has approved a 2-for-1 stock split of its common stock. Shareholders of record at the close of business on Jan. 7 will be entitled to one additional share for every share of common stock held on that date. The stock split will be distributed on Jan. 21, the company said in a statement.

For the quarter, Progress said revenues increased 13 percent to $78.1 million, up from $69.2 million in the same quarter a year earlier.

For its fiscal year 1999 ended Nov. 30, the company said revenues jumped 19 percent to $286.1 million from $239.9 million last year. Progress said net income for its fiscal year was $35 million, or $1.78, vs. $22.8 million, or $1.18, in its year-ago period, beating First Call's consensus estimate of $1.73.

The company attributes its better-than-expected quarterly results to increased demand for its applications via a new application service provider pricing model, which is a monthly subscription-based program that allows small to midsized companies to use enterprise applications for a lower monthly cost.

"Our financial results were driven by the fact that our independent software vendors sold more applications than ever before," said Progress president Joseph Alsop. "Additionally, between our traditional business and the recent boom in the emerging application service provider market, Progress Software has added several hundred new partners to our selling channel overall."

In related news, Progress today appointed David Ireland as vice president and general manager of field operations. In his new role, Ireland, who was most recently a product line manager at Progress, is responsible for the company's sales, services, support and education operations in North America, Europe, Asia Pacific, Latin America and Japan, the company said.