InfoVista Reports Solid Fourth Quarter and Full Fiscal Year Results

• Full-year performance in line with top and bottom-line objectives
• Significant fourth quarter license revenue growth

Paris, France – July 29, 2010 – InfoVista (Euronext: IFV, ISIN: FR0004031649), the leading provider of Service Performance Assurance solutions, today announced financial results for the fourth quarter and fiscal year, ended June 30, 2010.

Total revenues for the quarter were €12.2 million, compared to €11.5 million in the fourth quarter last year. On a normalized basis (i.e. excluding Microsoft license revenues in the prior year), revenues were up 13% from the comparable quarter last year, with strong license revenue growth year-on-year of 25%. Operating income was €1.1 million in the fourth quarter, while net income reached €1.2 million.

For the fiscal year 2010, InfoVista achieved normalized revenue growth of 5%, to €43 million, and a net income margin of 6%, in line with its objectives for the year.

Commenting on the Company’s performance, Philippe Ozanian, Chief Executive Officer, said: “The fast adoption of our new solutions, Vista360, Mobile Pack, APM (Application Performance Management), and our partnership with Cisco generated a remarkable fourth quarter license revenue increase of 25% compared to last year. Twelve consecutive quarters of positive operating margins, a revamped portfolio of solutions, and fruitful partnerships leave me very confident that InfoVista is in better shape than ever to take advantage of its leadership position. Our next fiscal year objectives will seek to accelerate our recent accomplishments so we look forward to discussing these with the financial community on September 9.”  

Financial Highlights

Revenues by Region

• In the Americas, fourth quarter revenues were up 7% on a normalized basis compared to last year. Recently released products led to a large win with a US-based mobile wholesale customer, while Cisco PNOC business provided positive traction.
• EMEA revenues grew by 16% in the fourth quarter. Emerging markets represented about half of EMEA license revenues, with a large number of repeat deals from follow-on phases with service providers in Serbia, South Africa and Saudi Arabia.
• Revenues in Asia-Pacific, up 14%, posted their fourth consecutive quarter of double-digit growth. New products that address mobile network service providers lifted license revenues.

• In the fourth quarter, InfoVista derived 40% of total revenues from its indirect sales channel. The service provider market generated 77% of total revenues for the quarter.

 Operating Expenses

• Gross margin in the fourth quarter was at 78%, compared to 79% for same period last year.  
• Sales & marketing costs represented 35% of total revenues in the fourth quarter, up 12% from the comparable quarter last year. This increase is a direct result of additional spending linked to revenue growth for the past quarter.
• Research & development costs represented 21% of revenues in the fourth quarter, up as compared to the same period last year. Excluding R&D tax credits in France, the fourth quarter R&D costs were unchanged year on year.
• General & administrative costs stood at €1.4 million in the fourth quarter or 12% of total revenues for the quarter. G&A spending was held flat with continued cost control.
• As at June 30, 2010, InfoVista had 231 employees.  

Income taxes

• InfoVista recorded a net €0.1 million income tax benefit during the fourth quarter, which included a deferred tax benefit of €0.4 million and an income tax expense of €0.3 million. According to IFRS accounting rules, InfoVista has determined that a portion of its more than €10 million deferred tax assets should be recorded for a €0.4 million benefit in the fourth quarter, as a result of past trends in positive net result performance as well as the positive outlook for fiscal year 2011.

Balance Sheet

• Days Sales Outstanding (DSO) stood at 98 days for the fourth quarter, as compared to 65 days in the comparable quarter last year. This increase in DSO resulted from exceptionally strong cash collections in the fourth quarter of the previous fiscal year.
• As at June 30, 2010, the Company’s cash, cash equivalent and short-term deposits amounted to €25.8 million, as compared to €28.6 million at June 30, 2009 and €23.1 million at March 31, 2010. For the quarter, the €2.7 million cash generation came primarily from operating activities. For the fiscal year, the cash consumption of €2.8 million came primarily from its stock buyback program.
• As at June 30, 2010, InfoVista had a total of 18,015,404 and 16,552,447 shares issued and outstanding, respectively.

Conference call to discuss 2010-11 objectives September 9, 2010

Please go to the investor relations webpage at www.infovista.com to view a video presentation of InfoVista’s 2010 financial results.

InfoVista will host an investor conference call on September 9, 2010 at 9.00 a.m. (EST) / 2:00 p.m. (UK) / 3:00 p.m. (Continental Europe). The call will be available by dialing France +33 (0)1 70 99 42 72 North America +1 212 444 0481 and +44 (0)20 7138 0824 in the UK. In each case followed by access code 6958646. A replay will be available shortly after the end of the call at the following numbers: France: +33 (0)1 74 20 28 00 UK: +44 (0)20 7111 1244 North America: +1 347 366 9565 – all with access code 6958646#.