Deltek, Inc. (Nasdaq: PROJ), the leading provider of enterprise applications software for project-focused businesses, today announced financial results for its second quarter ended June 30, 2009. Total revenue for Q2 was $69.4 million, an increase of 12% from Q1. Q2 license revenue increased 40% from Q1 to $15.8 million. Maintenance and support revenue in Q2 was $31.0 million, an increase of 1% from Q1. Consulting services revenue decreased 4% from Q1 to $19.2 million. Other revenues in Q2 increased to $3.4 million from $0.1 million in Q1.
Q2 GAAP net income increased 85% to $4.9 million, or $0.09 per diluted share, from $2.7 million, or $0.06 per diluted share, in Q1. Q2 non-GAAP net income increased 35% to $7.6 million, or $0.14 per diluted share, from $5.6 million, or $0.13 per diluted share, in Q1.
Excluding the additional shares issued in conjunction with the Company’s common stock rights offering, Deltek’s Q2 2009 non-GAAP and GAAP EPS would have been $0.17 and $0.11, respectively.
“We had a strong quarter and delivered financial results that significantly exceeded expectations,” said Kevin Parker, president and CEO of Deltek. “Our revenue and profitability were driven by improved execution across multiple facets of our business, a continuing focus on operational efficiency and cost reductions, and our customers’ increasing confidence in their future business prospects.”
“We remain focused on executing effectively and committed to delivering a strong bottom line and healthy cash flows. Looking forward, our sales pipeline continues to be strong and the numerous new products we’ve launched this year are being well received by our customers. Our strong competitive position provides a solid foundation for growth when the economy eventually recovers.”
When compared to prior year results, total revenue in Q2 was $69.4 million, compared to $77.4 million last year. License revenue for Q2 was $15.8 million, compared to $22.1 million in Q2 2008. Maintenance and support revenue in the second quarter was $31.0 million, an increase from $28.3 million in Q2 2008. Consulting services revenue for Q2 was $19.2 million, compared to $22.3 million in the prior year. Other revenues in Q2 were $3.4 million, compared to $4.6 million in the prior year.
GAAP net income for the second quarter was $4.9 million, or $0.09 per diluted share, compared to $5.4 million, or $0.11 per diluted share, last year. Non-GAAP net income for the second quarter of 2009 was $7.6 million, or $0.14 per diluted share, compared to $7.5 million, or $0.16 per diluted share, in Q2 2008.
Non-GAAP net income excludes the net-of-tax impact of stock-based compensation, expenses associated with the Company’s 2005 recapitalization, amortization of acquired intangible assets and restructuring charges.
- Deltek announced that its common stock rights offering was fully subscribed by its stockholders, including its largest stockholders, affiliates of New Mountain Capital. Upon completion of the rights offering, the Company issued 20,000,000 new shares of common stock at a price of $3.00 per share. Deltek used $3.1 million of the $58.2 million in net proceeds from the rights offering to repay indebtedness. Deltek ended Q2 with a cash balance of $113.5 million, compared to $43.0 million in Q1 2009. The $70.5 million increase in cash was driven by proceeds received from the Company’s common stock rights offering and cash flow generated from operations.
- Deltek announced the release of Premier Analytics, a new business intelligence solution for GCS Premier customers. Premier Analytics delivers executive dashboards that empower executives to monitor, measure, and manage their businesses using real-time data from GCS Premier, Deltek’s powerful project accounting solution for small-to-mid-size government contractors. Deltek also announced the release of GovWin 6.0, the newest version of its industry-leading business development and capture solution for firms who want to do more business with the Federal Government. GovWin 6.0 contains numerous usability enhancements that improve collaboration and communication throughout the business development process. The new release also offers unique Contract Data Management capabilities that enable companies to manage opportunities throughout the entire contract management lifecycle.
- Deltek announced the release of Cobra 5.0, the leading enterprise cost and earned value management (EVM) solution for government contractors and other project-based businesses. As the industry’s first EVM solution built on Microsoft’s .NET framework and Smart Client architecture, Cobra 5.0 eases the burden on IT resources with one-click deployment, and it eliminates the need for Citrix resulting in lower TCO. By delivering tight control over project costs, insight into mission-critical project data and the ability to easily calculate and report on earned value, Cobra 5.0 helps organizations better manage project and program performance.
- Deltek announced the release of Vision 6.0, the newest version of its industry-leading solution for professional services firms of all sizes. Vision 6.0 enables customers to fully unlock, analyze, and act on the essential data elements within Vision through role-based dashboards and SQL reporting services. In addition, Vision 6.0 offers capabilities to manage the global enterprise, including enhancements that simplify international accounting and tax transactions and foreign language support. In conjunction with Vision 6.0, Deltek also announced the release of Deltek Project Connect and Vision Performance Management. Project Connect facilitates bi-directional integration between Vision Resource Planning and Microsoft Project to keep resources and schedules in synch. Vision Performance Management dashboards empower organizations to proactively manage performance and mitigate risk.
- Deltek held its annual Insight customer conference in Orlando, Florida. Insight 2009 featured approximately 3,000 business leaders and partner attendees representing thousands of unique organizations. The conference showcased major product announcements across all of Deltek’s product lines, multiple channel and technology partners, and the winners of the Second Annual Deltek Project Excellence Awards, which recognize customers that achieve superior business performance through their use of Deltek products.
Impact of Common Stock Rights Offering on Historical Shares Outstanding
In accordance with SFAS 128-Earnings Per Share, for purposes of computing the basic and diluted weighted average shares, results for both 2009 and 2008 have been adjusted prior to June 1, 2009 to reflect the bonus element associated with the Company’s recently completed common stock rights offering. A summary of these retroactive changes is available on the Investor Relations section of Deltek’s website.
Conference Call Information
Deltek will host a conference call at 5:00 p.m. Eastern Time today to discuss the Company’s second quarter results. To access this call, dial 1-877-381-6419 in North America and 1-706-643-9496 outside North America. No password is required to join the call. The conference call also can be accessed through the Investor Relations section of Deltek’s website ( http://investor.deltek.com ). Those unable to participate in the live call may hear a replay through August 5, 2009 by dialing 1-800-642-1687 in North America and 1-706-645-9291 outside North America (pass code: 19459768). The replay also will be available through August 5, 2009 on Deltek’s website.
Deltek (Nasdaq: PROJ) is the leading provider of enterprise applications software designed specifically for project-focused businesses. For more than two decades, our software applications have enabled organizations to automate mission-critical business processes around the engagement, execution and delivery of projects. More than 12,000 customers worldwide rely on Deltek to measure business results, optimize performance, streamline operations and win new business. For more information, visit www.deltek.com