Nice Systems Ltd. (NICE), a provider of insight from interactions solutions and value-added services, Monday reported a decrease in net profit for the third quarter of fiscal 2009, primarily reflecting one-time acquisition costs and lower revenues. However, adjusted earnings per share beat Street estimates by a penny.
For the third quarter, the Ra'anana, Israel-based company's net earnings were $7.80 million or $0.12 per share compared to $10.92 million or $0.18 per share in the prior-year quarter. On an adjusted basis, net earnings declined to $23.99 million or $0.38 per share from $26.70 million or $0.43 per share in the 2008-year period.
Adjusted income excludes acquired deferred revenue totaling $1.37 million versus $504 thousand, amortization of acquired intangible assets amounting to $8.41 million from $7.98 million, acquisition related compensation costs of $716 thousand compared to $306 thousand, and share-based compensation totaling $5.53 million versus $5.38 million last year. Adjusted results also exclude one-time costs of $4.07 million with regard to acquisition.
On an average, 15 analysts polled by Thomson Reuters expected Nice Systems to earn $0.37 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter fell to $144.68 million from $162.49 million in the third quarter of fiscal 2008. Adjusted revenues for the three-month period were $146.05 million versus $163.00 million. Adjusted revenues exclude adjustment on acquired deferred revenue totaling $1.37 million versus $504 thousand in the previous year. Analysts expected the company to generate revenues of $144.81 million for the quarter.
Revenues from product were $69.23 million versus $87.99 million, while revenues from services rose to $75.45 million from $74.50 million a year ago.
Total operating expenses incurred by Nice were $80.61 million versus $84.21 million in the previous year. General and administrative expenses for the quarter slipped to $21.96 million from $23.53 million in the same quarter last year.
During the three-month period, the company had a financial income of $1.62 million compared with an expense of $1.37 million in the 2008-year period. In the third quarter, Nice Systems had a tax benefit of $1.39 million versus a tax provision of $3.79 million in fiscal 2008.
Commenting on the results, president and chief executive officer Zeevi Bregman said, "This quarter we continued to strengthen our market position with major wins such as the $55 million mega security deal from a government agency, as well as, several strategic deals in our enterprise business."
For the nine-month period, Nice Systems' net income surged to $30.01 million or $0.48 per share from $20.37 million or $0.33 per share in the comparable period prior year. Adjusted net income was $72.54 million or $1.17 per share versus $67.40 million or $1.09 per share in the previous year.
Year-to-date revenues slumped to $424.29 million from $461.07 million last year. Adjusted revenues for the nine months were $425.75 million compared to $465.03 million in the first three quarters of fiscal 2008.
"Looking ahead, we are cautiously optimistic that these trends will continue to generate gradual growth for NICE in the fourth quarter and 2010," Bregman added.
NICE closed Friday's regular trading session on the Nasdaq at $30.97 per share on a volume of 1,347 shares.
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