Iona boosts revenue, posts loss
30-04-2008
by ElectricNews.Net

Irish software giant Iona Technologies has recorded first quarter revenue growth of 6 percent, but still recorded a net loss.

The Dublin-based company, which develops middleware and web services software, saw its revenue rise to USD16.4 million compared to USD15.6 million a year earlier.

The firm saw losses widening year-on-year from a loss of USD2.8 million, or USD0.08 per share, in the first quarter of 2007, to a net loss of USD5.1 million, or USD0.14 per share, for the first three months of 2008. The 2008 loss includes share-based compensation expenses, amortisation and a USD1.5 million restructuring charge.

Licence revenue from the company's flagship product Artix grew 31 percent year-on-year. Meanwhile, its Corba revenue outperformed expectations, but still declined 5 percent.

Iona chief executive Peter Zotto said the firm was on course to meet 2008 revenue targets.

"I am pleased with our first quarter performance," said Zotto, in a statement. "Despite a difficult economic environment, Artix license growth of 31 percent was strong, indicating the growing strength of the Artix product line. Corba revenue exceeded our expectations and the Fuse Open Source product line continues to add new customers to Iona's expanding base."

Chief financial officer Christopher Mirabile said the performance was a "solid foundation" for growth in 2008.

"The cost reduction plan was aggressively implemented and we are continuing our focus on tightly managing operational expenses," he said. "Our expense run-rate has now increased to include advisory fees associated with the Board's evaluation of strategic alternatives for Iona. In addition, the current weakness of the US dollar is expected to have a continued negative impact on our operating profit."

The company issued an unchanged revenue guidance for the year, with total revenues expected in the range of USD80 million to USD85 million. However, additional restructuring expenses are also anticipated.

Founded in 1991 in Dublin, the company has been the subject of intense speculation over possible takeovers, with Germany's Software AG seen as a possible suitor. In January, the company announced a restructuring plan in a bid to cut costs after poor results in the fourth quarter of 2007.