iSeries Software Helps NetManage’s Recovery
February 6, 2006 Timothy Prickett Morgan
NetManage, the legacy application access and extension software provider, is seeing continued improvement in profits as it rolls out new products and deals with lower revenues. In the fourth quarter of 2005, NetManage reported sales of $10.7 million, down 19 percent, but net income was more than doubled to $1.6 million, or about 17 cents per share. For the full year, NetManage posted sales of $43.4 million, down 9 percent, but because of a $1.8 million tax benefit in 2005, was able to push profits to $4.7 million, more than triple from the prior year. The company’s cash position also improved, with NetManage leaving the quarter with $23.1 million, up 17 percent.
Like other software providers in the iSeries market, NetManage is hoping that the belt tightening and product development it did in 2005 will translate into higher sales and bigger profits in 2006. “The fourth quarter of 2005 delivered many positives, including the continued migration by our customers to our newer technologies, the addition of new customers for our OnWeb and Librados solutions and the introduction of NetManage OnWeb for iSeries,” said Zvi Alon, chairman, president, and CEO of NetManage in a statement accompanying the financial results. “We are pleased with the operating efficiencies we achieved this year resulting in a reduction in expenses and improvement in operating income. We believe we have made significant progress during 2005 toward creating a more profitable and productive organization. We are confident that we will continue to improve and deliver significant value to both our customers and shareholders in 2006.”