ucantfoolmee
15 years ago
Gartner Reports Financial Results for Second Quarter 2009
Gartner, Inc. (NYSE: IT), the leading provider of research and analysis on the global information technology industry, today reported results for second quarter 2009. In addition, the Company reiterated its financial outlook for full year 2009.
EPS from continuing operations were $0.18, net income was $17.2 million, and Normalized EBITDA was $44.0 million. See "Non-GAAP Financial Measures" for a discussion of Normalized EBITDA.
Total revenue for second quarter 2009 was $270.0 million. Excluding the impact of foreign exchange, total revenue decreased 16% year-over-year, principally due to lower revenues from the Company’s Events and Consulting segments. Revenue from the Company’s Research segment declined 1% year-over-year, excluding the impact of foreign exchange.
Gene Hall, Gartner's chief executive officer, commented, "During the second quarter of 2009, our businesses performed in-line with our expectations. More importantly, many of our key metrics showed sequential improvement. As compared to the first quarter, we increased new business in Research, added significantly more new client enterprises, improved salesforce productivity and saw improvement in the trends that drive wallet retention. These results reflect a stabilizing of the sales environment, the success of our initiatives to improve operational effectiveness and the tremendous value that we provide to IT professionals. Based on these trends, we expect contract value to grow sequentially in the second half of the year, primarily in the fourth quarter, and we expect to quickly resume revenue and earnings growth once global economic activity returns to more normal levels.”
Business Segment Highlights
Research
Revenue for second quarter 2009 was $183.9 million, down 1% year-over-year excluding the impact of foreign exchange. Gross contribution margin improved approximately 2 percentage points year-over-year to 65%.
Contract value was $736.0 million at June 30, 2009. Excluding the impact of foreign exchange, contract value decreased 3% year-over year.
Client and wallet retention rates for second quarter 2009 were 77% and 86%. Wallet retention excludes the impact of foreign exchange.
Consulting
As previously communicated, the Company entered 2009 and the second quarter with lower Consulting backlog. As a result, revenue for second quarter 2009 was $69.3 million, down 21% year-over-year excluding the impact of foreign exchange. Gross contribution margin was 40%.
Second quarter 2009 utilization was 68% and billable headcount was 459. Backlog was $81.7 million at June 30, 2009.
Events
As part of its previously announced plan to reduce the number of events in 2009 versus 2008, the Company held only 14 events in second quarter 2009 versus 25 in second quarter 2008. This included the elimination of two large Spring Symposium events. These changes negatively impacted year-over-year revenue comparisons for the quarter.
Revenue for the quarter was $16.7 million, down 61% year-over-year excluding the impact of foreign exchange. The 14 events held attracted 5,108 attendees. Gross contribution margin was 33%.
Cash Flow and Balance Sheet Highlights
Gartner generated cash from operations of $47.7 million during second quarter 2009. Capital expenditures were $3.9 million.
During the first half of 2009, the Company deployed its cash principally to repay almost $100 million in debt. As of June 30, 2009, the Company had total debt of $316.5 million and cash of $97.0 million.
Financial Outlook for 2009
Based on its first half 2009 results and current business trends, Gartner reiterated its financial outlook for full year 2009. The Company continues to project 2009 revenue by segment and total revenue as follows. The year-over-year change is presented both as reported and excluding the impact of foreign exchange (FX Neutral):
($ in millions) 2009 Projected Revenue % Change as Reported % Change FX Neutral
Research(1)
$ 737 – 757 (6%) – (3%) (2%) – 1%
Consulting 265 – 295 (24%) – (15%) (21%) – (12%)
Events 98 – 108
(35%) – (28%)
(33%) – (26%)
Total Revenue $ 1,100 – 1,160 (14%) – (9%) (10%) – (6%)
(1)
Projected research revenue includes the revenue of the Company’s “Other” category, which was eliminated in first quarter 2009. For 2008, reported “Other” revenue was $8.3 million.
Based on this revenue outlook, Gartner continues to target full year 2009 Normalized EBITDA of $170 to $200 million, EPS from continuing operations of $0.66 to $0.87, cash flow from operations of $100 to $125 million and capital expenditures of $15 to $20 million. Normalized EBITDA excludes a projected $26 to $28 million of pre-tax expense related to SFAS 123(R).
Conference Call Information
Gartner has scheduled a conference call at 10:00 a.m. ET today, Tuesday, August 4, 2009, to discuss the Company's financial results. The conference call will be available via the Internet by accessing the Company's web site at http://investor.gartner.com. A replay of the webcast will be available for 90 days following the call.
About Gartner
Gartner, Inc. (NYSE: IT) is the world’s leading information technology research and advisory company. We deliver the technology-related insight necessary for our clients to make the right decisions, every day. From CIOs and senior IT leaders in corporations and government agencies, to business leaders in high-tech and telecom enterprises and professional services firms, to technology investors, we are the indispensable partner to 60,000 clients in 10,000 distinct organizations. Through the resources of Gartner Research, Gartner Executive Programs, Gartner Consulting and Gartner Events, we work with every client to research, analyze and interpret the business of IT within the context of their individual role. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, U.S.A., and has 4,000 associates, including 1,200 research analysts and consultants, and clients in 80 countries. For more information, visit www.gartner.com.
Non-GAAP Financial Measures
Investors are cautioned that normalized EBITDA contained in this press release is not a financial measure under generally accepted accounting principles. In addition, it should not be construed as an alternative to any other measures of performance determined in accordance with generally accepted accounting principles. This non-GAAP financial measure is provided to enhance the user's overall understanding of the Company's current financial performance and the Company's prospects for the future. We believe normalized EBITDA is an important measure of our recurring operations as it excludes items that may not be indicative of our core operating results. Normalized EBITDA is based on operating income, excluding depreciation, accretion on obligations related to excess facilities, amortization, SFAS 123 (R) expense, and Other charges.
Safe Harbor Statement
Statements contained in this press release regarding the growth and prospects of the business, the Company's projected 2009 financial results and all other statements in this release other than recitation of historical facts are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include risks and uncertainties; consequently, actual results may differ materially from those expressed or implied thereby. Factors that could cause actual results to differ materially include, but are not limited to ability to expand or even retain the Company's customer base; ability to grow or even sustain revenue from individual customers; ability to attract and retain professional staff of research analysts and consultants upon whom the Company is dependent; ability to achieve and effectively manage growth; ability to pay the Company's debt obligations; ability to achieve continued customer renewals and achieve new contract value, backlog and deferred revenue growth in light of competitive pressures; ability to carry out the Company's strategic initiatives and manage associated costs; substantial competition from existing competitors and potential new competitors; additional risks associated with international operations including foreign currency fluctuations; the impact of restructuring and other charges on the Company's businesses and operations; general economic conditions; and other risks listed from time to time in the Company's reports filed with the Securities and Exchange Commission. These filings can be found on Gartner's Web site at www.gartner.com/investors and the SEC's Web site at www.sec.gov. Forward-looking statements included herein speak only as of the date hereof and the Company disclaims any obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances.
GARTNER, INC.
Condensed Consolidated Statements of Operations
(Unaudited; in thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
Revenues:
Research (a) $ 183,919 $ 198,362 -7 % $ 371,607 $ 389,769 -5 %
Consulting 69,314 94,607 -27 % 139,633 172,725 -19 %
Events 16,738 50,970 -67 % 32,264 71,544 -55 %
Total revenues 269,971 343,939 -22 % 543,504 634,038 -14 %
Costs and expenses:
Cost of services and product development (a) 117,100 156,478 -25 % 233,744 287,079 -19 %
Selling, general and administrative (a) 115,367 133,421 -14 % 230,931 259,666 -11 %
Depreciation 6,338 6,064 5 % 12,813 12,573 2 %
Amortization of intangibles 405 401 1 % 804 815 -1 %
Total costs and expenses 239,210 296,364 -19 % 478,292 560,133 -15 %
Operating income 30,761 47,575 -35 % 65,212 73,905 -12 %
Interest expense, net (4,011 ) (4,960 ) -19 % (8,191 ) (9,675 ) -15 %
Other (expense) income, net (1,132 ) (150 ) >100% (2,378 ) 373 >100%
Income before income taxes 25,618 42,465 -40 % 54,643 64,603 -15 %
Provision for income taxes 8,433 12,337 -32 % 17,462 19,882 -12 %
Income from continuing operations 17,185 30,128 -43 % 37,181 44,721 -17 %
(Loss) income from discontinued operations, net of taxes (b) - (228 ) -100 % - 6,723 >100%
Net income $ 17,185 $ 29,900 -43 % $ 37,181 $ 51,444 -28 %
Income per common share:
Basic:
Income from continuing operations $ 0.18 $ 0.32 -44 % $ 0.39 $ 0.46 -15 %
Income from discontinued operations - - 0 % - 0.07 >100%
Income per share $ 0.18 $ 0.32 -44 % $ 0.39 $ 0.53 -26 %
Diluted:
Income from continuing operations $ 0.18 $ 0.30 -40 % $ 0.39 $ 0.44 -11 %
Income from discontinued operations - - 0 % - 0.07 >100%
Income per share $ 0.18 $ 0.30 -40 % $ 0.39 $ 0.51 -24 %
Weighted average shares outstanding:
Basic 94,370 94,845 -1 % 94,134 96,317 -2 %
Diluted 96,523 98,895 -2 % 96,344 100,252 -4 %
(a)
The Company eliminated its previously reported “Other” revenue line in the first quarter of 2009.
"Other" revenue and related expenses are now being reported in the Research segment.
In addition, certain expenses that were formerly classified as Selling, general and administrative (SG&A)
are now presented in Cost of services and product development (COS) and are considered to be expenses
of the Research segment.
Corresponding prior period presentations of these revenues and expenses have been reclassified
in a consistent manner for comparability purposes.
(b)
2008 includes the results and gain on sale of the Vision Events business, which we sold in February 2008.
BUSINESS SEGMENT DATA (a)
(Dollars in thousands)
Direct Gross Contribution
Revenue Expense Contribution Margin
Three Months Ended 6/30/09
Research (a) $ 183,919 $ 64,454 $ 119,465 65 %
Consulting 69,314 41,678 27,636 40 %
Events 16,738 11,154 5,584 33 %
TOTAL $ 269,971 $ 117,286 $ 152,685 57 %
Three Months Ended 6/30/08
Research (a) $ 198,362 $ 73,117 $ 125,245 63 %
Consulting 94,607 54,072 40,535 43 %
Events 50,970 28,331 22,639 44 %
TOTAL $ 343,939 $ 155,520 $ 188,419 55 %
Six Months Ended 6/30/09
Research (a) $ 371,607 $ 127,411 $ 244,196 66 %
Consulting 139,633 84,977 54,656 39 %
Events 32,264 21,897 10,367 32 %
TOTAL $ 543,504 $ 234,285 $ 309,219 57 %
Six Months Ended 6/30/08
Research (a) $ 389,769 $ 143,079 $ 246,690 63 %
Consulting 172,725 100,853 71,872 42 %
Events (b) 71,544 39,926 31,618 44 %
TOTAL $ 634,038 $ 283,858 $ 350,180 55 %
(a)
The Company eliminated its previously reported “Other” revenue line in the first quarter of 2009.
"Other" revenue and related expenses are now being reported in the Research segment.
In addition, certain expenses that were formerly classified as Selling, general and administrative (SG&A)
are now presented in Cost of services and product development (COS) and are considered to be expenses
of the Research segment.
Corresponding prior period presentations of these revenues and expenses have been reclassified
in a consistent manner for comparability purposes.
(b)
Excludes the results of the Vision Events business, which we sold in February 2008.
SELECTED STATISTICAL DATA
June 30, June 30,
2009 2008
Research contract value $ 735,974 (a) $ 794,153 (a)
Research client retention 77 % 81 %
Research wallet retention (b) 86 % 98 %
Research client organizations 9,882 10,207
Consulting backlog $ 81,727 (a) $ 111,300 (a)
Consulting--quarterly utilization 68 % 75 %
Consulting billable headcount 459 478
Consulting--average annualized revenue
per billable headcount $ 398 (a) $ 489 (a)
Events--number of events for the quarter 14 25
Events--attendees for the quarter 5,108 13,873
(a)
Dollars in thousands.
(b)
Excludes the impact of foreign exchange.
SUPPLEMENTAL INFORMATION
GAAP to Normalized EBITDA Reconciliation
(in thousands)
Reconciliation - GAAP to Normalized EBITDA (1):
Three Months Ended Six Months Ended
June 30, June 30,
2009 2008 2009 2008
Net income $ 17,185 $ 29,900 $ 37,181 $ 51,444
Interest expense, net 4,011 4,960 8,191 9,675
Other expense (income), net 1,132 150 2,378 (373 )
Loss (income) from discontinued operations (2) - 228 - (6,723 )
Tax provision 8,433 12,337 17,462 19,882
Operating income $ 30,761 $ 47,575 $ 65,212 $ 73,905
Normalizing adjustments:
Depreciation, accretion, and amortization 6,922 6,706 13,994 13,883
SFAS No. 123(R) stock compensation expense (3) 6,333 6,424 13,125 13,056
Normalized EBITDA $ 44,016 $ 60,705 $ 92,331 $ 100,844
(1)
Normalized EBITDA is based on operating income excluding depreciation,
accretion on obligations related to excess facilities, amortization of intangibles,
Other charges, and SFAS No. 123(R) expense.
(2)
The six months ended June 30, 2008, includes the gain on sale of the Vision Events business.
(3)
Stock compensation expense represents the cost of stock-based compensation
awarded by the Company to its employees under Statement of Financial Accounting
Standards No. 123(R), "Share-Based Payments"
ucantfoolmee
16 years ago
Siperian Positioned in Visionaries Quadrant of 2009 Master Data Management for Customer Data
Evaluation Based on Completeness of Vision and Ability to Execute
FOSTER CITY, Calif., June 23 /PRNewswire/ -- Siperian, Inc. - developers of an award-winning master data management (MDM) platform - today announced that the Company has been positioned in the Visionaries quadrant of the Gartner, Inc. (NYSE:IT) 2009 Gartner Magic Quadrant for Master Data Management (MDM) of Customer Data research report.(1) The report evaluates numerous vendors based on a rigorous set of criteria that comprise "completeness of vision" and "ability to execute." In the report, Gartner predicts that the MDM of customer data market will continue to grow for several years, and their estimate is that it will account for approximately $1 billion in software revenue in 2012. To access the full report written by John Radcliffe and published on June 16, 2009, compliments of Siperian, visit http://forms.siperian.com/content/Gartner2009PR
The report noted that "MDM programs potentially encompass the management of customer, product, asset, person or party, supplier and financial masters. As the name suggests, MDM of customer data focuses on the management of the domain relating to customer data, whereas MDM of product data technology focuses on the domain relating to product data."
Siperian MDM Hub(TM) is a true multi-entity MDM platform that supports multiple data domains, including customer, product, employee, location and any other data type, all on the same platform.
With customer data as the platform's core strength, Siperian customers have started their MDM journey with customer entity and then expand the usage to other entities over time for greater value and a higher return on investment. While all of Siperian customers have adopted Siperian MDM Hub to manage their customer-related efforts, nearly half leverage the same platform to expand to other entities such as product. Siperian's flexible, integrated, model-driven MDM platform enables its system integration partners to develop cross-industry, multi-entity MDM solutions delivering fast time to value.
"As a best-in-class provider and the leading multi-domain MDM solution, Siperian enables our clients to handle both operational and analytical MDM by supporting any type of data including customer, product, location and reference data," commented Peter Caswell, president and CEO of Siperian. "In my opinion, our inclusion in the latest MDM report, demonstrates our ongoing commitment to delivering faster time to value, and greater return on investment for our clients."
About the Magic Quadrant
The Magic Quadrant is copyrighted 2009 by Gartner, Inc. and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner's analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose
About Siperian, Inc.
Siperian's Master Data Management (MDM) software platform provides a reliable and unified view of critical customer, product, supplier, and employee data to business users in Global 500 companies across 15 different industries. Through improved access to real-time information from distributed data sources, organizations can achieve higher profitability while reducing operational costs and improving compliance. Siperian's MDM Hub(TM) is a flexible and integrated software platform that significantly lowers total cost of ownership and delivers faster time-to-value and superior return-on-investment. Siperian meets the needs of data intensive companies by enabling them to improve customer relationship management, sales and marketing, regulatory compliance, and order-to-cash processes. With corporate headquarters in Foster City, California, Siperian has offices throughout the United States and in Toronto, Canada; the Company's EMEA operation is headquartered in London. To learn more about Siperian visit http://www.siperian.com/ or call 1-866-747-3742.
(1) Gartner, Inc. "Magic Quadrant for Master Data Management of Customer Data" by John Radcliffe, June 16, 2009
Siperian and Siperian MDM Hub are trademarks of Siperian, Inc. The names of actual companies or products mentioned herein may be the trademarks of their respective owners.
MEDIA CONTACTS: Chris McCoin or Richard Smith McCoin & Smith Communications Inc.
508-429-5988 (Chris) or 978-433-3304 (Rick) or
DATASOURCE: Siperian, Inc.
CONTACT: Chris McCoin, +1-508-429-5988, , or
Richard Smith, +1-978-433-3304, , both of McCoin & Smith
Communications Inc., for Siperian, Inc.
Web Site: http://www.siperian.com/
MadeIt
16 years ago
STOCKHOLM -(Dow Jones)- Smartphone growth continued in the first quarter, proving a bright spot in an otherwise gloomy picture as global handset sales fell at a record pace, research firm Gartner Inc. (IT) said Wednesday.
Smartphones, such as Apple Inc's (AAPL) iPhone and a growing number of touchscreen devices from other manufacturers, have defied the downturn, aided by growth in applications as they broaden their reach into both the mid-tier and high-tier segments.
Still, the rapid downturn in consumer spending has hammered the wider market as customers delay upgrades and hold off buying new phones.
"There were some signs of a recovery in markets such as North America and China, but overall sales in the first quarter of 2009 registered the biggest quarter-on-quarter contraction since Gartner began monitoring the market on a quarterly basis in 2001," Gartner mobile device research director Carolina Milanesi said.
"We really don't see demand stabilizing before the second half of 2010," Milanesi told Dow Jones Newswires, with the global handset market returning to growth of 5%-6% in 2010.
First quarter sales fell 14.5% from the fourth quarter 2008, Gartner said, while the 9.4% fall on year, to 269 million, was also the sharpest on record.
"Device vendors will focus increasingly on smartphones, improved user interfaces and services to differentiate themselves and fuel consumer demand," Milanesi said.
Smartphone sales increased 12.7% to 36 million units, and represented 13.5% of all mobile device sales in the first quarter 2009, up from 11% in the first quarter of 2008, Gartner said.
"Making sure you have a strong smartphone portfolio is going to be very important for the vendors, and that is what is going to make a lot of the difference," Milanesi said.
"Much of the smartphone growth during the first quarter of 2009 was driven by touchscreen products, both in mid-tier and high-end devices," said Roberta Cozza, principal analyst at Gartner.
Nokia Corp. (NOK) maintained its leading position overall, although its market share dropped to 36.2% from 39.1% a year earlier. Overall sales fell and the average selling price of its phones declined 18% from a year earlier, Gartner said. However, sales of Nokia smartphones grew after it introduced its 5800 device into more regions.
Nokia started shipping its 5800 touch screen smartphone at the end of 2008.
Samsung Electronics Co. Ltd's (SSNHY) market share increased 4.7 percentage points to 19.1% and it returned to double-digit profitability due to a good product mix.
"The announcement of its first Android-based product, the i7500, will help Samsung in a highly competitive second half of 2009," Gartner said.
LG Electronics Inc's (066570.SE) market share increased to 9.9% from 8%. The company benefited from a very strong portfolio of touchscreen, messaging and imaging devices, said Gartner.
Motorola Inc's (MOT) market share fell to 6.2% from 10.2%. The company "continued to experience significant difficulties even in its home market," Gartner said.
Sony Ericsson's (ERIC, SNE) market share fell to 5.4% from 7.5%, partly due to a weak product portfolio, said Gartner.
(Units in thousands)
1Q 09 1Q 09 Mkt Shr 1Q 08
Nokia 97,398 36.2% 115,192
Samsung 51,385 19.1% 42,397
LG 26,547 9.9% 23,646
Motorola 16,587 6.2% 29,885
Sony Ericsson 14,470 5.4%% 22,061
Others 62,732 23.4% 61,103
Total 269,120 100% 294,283
(Smartphones - thousands of units)
1Q 09 1Q 09 Mkt Shr 1Q08
Nokia 14,991 41.2% 14,589
RIM 7,234 19.9% 4,312
Apple 3,939 10.8% 1,725
HTC 1,957 5.4% 1,277
Fujitsu 1,387 3.8% 1,318
Others 6,896 18.8% 9,095
Total 36,404 100% 32,315
(All data from Gartner, May 2009)
Company Web site: www.gartner.com
-By Gustav Sandstrom, Dow Jones Newswires; +46-8-5451-3099; gustav.sandstrom@dowjones.com
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