Cognos Reports 4Q Sales And Earnings Surge

Surging license sales and a big contract with an unnamed government agency pushed revenue at business-intelligence software vendor Cognos Inc. up 27% to $256.3 million in its fourth quarter ended Feb. 28. Net income grew 18% to $54.3 million, or 58 cents per share, the company said.

Software license revenue grew 39% to $129.9 million in the quarter. "There aren't too many companies our size growing their license revenue at 39%," says Neal Hill, Cognos' corporate development VP.

For all of fiscal 2005, revenue was $825.5 million, up 21% from $683.1 million in 2004. Net income for the year was $136.6 million ($1.47 per share), up 35% from $100.9 million in 2004.

License sales of Cognos' ReportNet reporting and analysis tool, which debuted in 2003, increased 83% year over year in the quarter to $54.3 million, the company said. Sales for the whole year reached $153.4 million. The company also said that license revenue generated by its Cognos Planning software increased 53%, although it didn't disclose a dollar figure.

During the quarter, Cognos recorded its first contract worth more than $10 million, a $12.7 million deal with a government agency that Hill declined to name. The contract with the agency, a new customer, included most of Cognos' product line, he said. Cognos inked 18 contracts worth $1 million or more during the fourth quarter and 48 such contracts throughout fiscal 2005.

For the current quarter, Cognos expects revenue in the range of $202 million to $210 million and earnings of 22 to 25 cents per share. For fiscal 2006, Cognos expects revenue in the range of $930 million to $950 million and earnings of $1.55 to $1.62 per share.