Progress Software Corporation (NASDAQ: PRGS) stock rose over 4.2% on March 29th. 2018 (as of 29 Mar, 9:43 AM GMT-4; Source: Yahoo finance).
The group reported a total revenue of $94.2 million during the first quarter of 2018 which is $1.2 million above the high-end of their guidance range of $93 million. Better than expected performance was mainly on the back of a favorable FX impact of over $800,000, on the back of the weaker U.S. dollars.
The group’s earnings per share rose 59% yoy to $0.54 during the quarter which is above the high-end of their guidance range of $0.48. The $0.06 overachievement consisted of $0.02 from higher revenue and $0.04 from lower expenses. The group was able to deliver a 37% operating margin for the quarter, which is a rise of 700 basis points as compared to the first quarter in pcp.
The overall revenue rose 3% yoy to $94.2 million based on actual exchange rates but flat on a constant currency basis. The License revenue rose 4% yoy to $25.4 million as at actual exchange rates and 1% on a constant currency basis. Maintenance and services revenue rose 3% yoy to $68.8 million, on a actual exchange rates basis, while license revenue rose 1% yoy at constant currency driven by DCI segment, offset by a slight fall from their OpenEdge and AD&D segments.
The group returned over $50 million to shareholder via share repurchases and dividend. The group’s core business was boosted by a solid performance from their OpenEdge ISVs with a rise of over 20% in SaaS related revenue from their partners who offer their applications in the cloud. Their App Dev segment, showed a double digit booking rise driven by DevTool and Sitefinity coupled with new versions of both of their Telerik and Kendo UI tool sets.
However, their multi-year license backlog reached $15.6 million during first quarter of 2018 from $22.3 million as at the end of Q1 of last year. The DCI backlog impact was on the back of OEM contracts which were renewed while revenue was recognized. The year-over-year fall is mainly on the back of timing of those renewals.
Progress Software is aiming 36% to 37% margins for this year, which is a rise of 100 basis points while boosted their EPS guidance by $0.06 for FY18.