Progress Software has turned in a poor set of year-end financial results and does not expect to be back on track until 1998.
The database and tools vendor saw revenues for its fourth quarter, ended 30 November, fall 15 per cent to $45.2 million, with net profits down from $6.2 million in the same quarter last year to $705,000, a massive fall of 89 per cent. For the full year, sales dropped two per cent to $176.7 million, while net income dropped 71 per cent from $19.1 million last year to $5.5 million.
Bud Robertson, Progress? chief financial officer, said: ?We are concerned, but we?re looking at all the fundamentals of the business. We have two new products on the market, Webspeed and Progress 8.1, we?re selling more of version 7 and 8 than ever before, we have a lot of cash in the bank, and we?re stabilising and growing the business. Next year, we expect to grow under 10 per cent, so we won?t be back to historical growth levels then, but we will in 1998.?
He added that the company had, like its rivals, suffered from competitive market conditions, particularly as customers were delaying their client/server purchasing decisions to see what happened with the Web.
A change in pricing policy from platform-based to user-based pricing had also had a slight impact on revenues at the start of the year, although this had now panned out.
And Progress? applications partners, through which it generated up to 70 per cent of its sales, had been slow to move from character-based products to its new graphical development tools.
But, Robertson added, the company had no plans to reduce headcount to bring costs in line with revenues and even planned to add staff in research and development and marketing.
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