InfoVista Reports Good Third Quarter FY10 Results

• Improving revenue trends across all regions
• Further sales and marketing productivity gains

Paris, France – May 6, 2010 – InfoVista (Euronext: IFV, ISIN: FR0004031649), the leading provider of Service Performance Assurance solutions, today announced financial results for the third quarter, ended March 31, 2010.

Total revenues for the quarter were €10.6 million, compared to €10.9 million in the third 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 double-digit growth in both licenses and services. Operating profit was €0.6 million for the third quarter of fiscal 2010, as compared to a loss of €0.5 million for the same period last year. InfoVista posted a net profit for the third quarter of €0.7 million, versus a net loss of €0.4 million in the comparable quarter last year.

Commenting on the Company’s performance, Philippe Ozanian, Chief Executive Officer, said:

“I am pleased with our Q3 performance, which demonstrates that InfoVista is now benefiting from growing market adoption of our new solutions. This quarter, we had another solid performance in services, but the big improvement came with license revenues, which rose 10%, on a normalized basis, to €4 million. Emerging countries continued to represent an important source of revenues, but we also see strong indications that our more mature markets are turning the corner. This allows us to confirm our top- and bottom-line objectives for the full year.

We are experiencing good momentum, notably with our Cisco partnership and growing interest in our newly released products, in the data mobile space in particular. With new solutions, a good pipeline and a lean cost structure, InfoVista has all the elements in place to accelerate top- and bottom-line growth in the coming fiscal year.” 

Financial Highlights

Revenues by Region

• In the Americas, business trends improved materially this quarter, with revenues up 12% on a normalized basis. This increase is mainly due to growth in license revenues. On a constant dollar basis, total revenues would have risen 20%.
• EMEA revenues rose by 7% in the third quarter, as compared to last year. License revenues were stable, while services revenues grew steadily.
• Revenues in Asia-Pacific once again posted strong growth in the quarter, up 41% as compared to the prior year. Both license and service businesses drove this revenue growth.
  • In the third quarter, InfoVista derived 35% of total revenues from its indirect sales channel. The service provider market generated 78% of total revenues for the quarter.

Operating Expenses

• Gross margin in the third quarter remained stable at 76%, as compared to the same period last year, despite higher contribution from services to total revenues. 
• Sales & marketing costs represented 34% of total revenues in the third quarter virtually unchanged from the prior year. This level of spending reveals a significant productivity gain since normalized license revenues increased by 10%.
• Research & development costs represented 20% of revenues in the third quarter, remaining stable as compared to the same period last year.  This quarter's R&D costs benefited from a €0.4 million additional net R&D tax credit in France claimed for the 2009 calendar year.
• General & administrative costs stood at €1.5 million in the third quarter or 15% of total revenues for the quarter. G&A in the quarter comprised non-recurring costs of €0.1 million.
• As at March 31, 2010, InfoVista had 230 employees.

Balance Sheet

• Days Sales Outstanding (DSO) stood at 105 days for the third quarter, as compared to 92 days in the comparable quarter last year. This increase in DSO resulted from delays in cash collections partially received in April 2010.
• As at March 31, 2010, the Company’s cash, cash equivalent and short-term deposits amounted to €23.1 million, as compared to €23.5 million at the end of the prior quarter. In the third quarter, InfoVista generated €0.5 million in cash from operations and disbursed €1 million for the repurchase of shares, representing 2% of issued capital.
• As at March 31, 2010, InfoVista had a total of 18,012,904 and 16,573,580 shares issued and outstanding, respectively.

Conference call

InfoVista will host an investor conference call on Thursday, May 6, 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 69 North America +1 212 444 0481 and +44 (0) 20 7138 0826 in the UK. In each case followed by access code 1137724. 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 1137724#.

Download the INCOME STATEMENTS and CONSOLIDATED BALANCE SHEETS (pdf)