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Progress Software Reveals Strategic Plan; To Cut Workforce By 10% - 15%

Progress Software Corp. (PRGS: Quote) unveiled a new strategic plan designed to enhance growth, profitability and shareholder value. Pursuant to the plan, Progress would become a provider of a next-generation, context-aware application development and deployment platform in the Cloud for the Application Platform-as-a-Service market by investing in its core OpenEdge, DataDirect Connect and Apama Analytics and Decisions products and integrating them into a single, cohesive offering.

According to the plan, Progress would divest multiple product lines that are not core to the new vision and launch immediate operational restructuring initiatives to significantly reduce annual costs. Further, Progress' board has authorized a substantial new share buyback program.

In addition, the company plans to reduce its global workforce by nearly 10 - 15 percent, anticipating to complete most of these workforce reductions during its second and third fiscal quarters of 2012. Also, Progress expects to reduce annual run-rate costs by some $55 million gross, expected to be net $40 million after additional investments, by the end of fiscal 2012.

Beginning with its fiscal second quarter, the company intends to separately report on a non-GAAP basis its core and non-core operations. For its core products, the company sees revenue growth rate of 5% in fiscal 2013 and 7% growth in fiscal 2014 and beyond and about 35% operating margins by fiscal 2013.

by RTT Staff Writer

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