BETHESDA, Md., Oct. 29, 2009 (GLOBE NEWSWIRE) -- OPNET Technologies, Inc. (Nasdaq:OPNT), a leading provider of solutions for managing networks and applications, today announced that revenue for the second fiscal quarter, ended September 30, 2009, was $30.6 million, compared to $32.4 million for the same quarter in the prior fiscal year. Diluted earnings per share for the second quarter of fiscal 2010 were $0.07, compared to $0.10 for the same quarter in the prior fiscal year. The Company also announced today a quarterly dividend of $0.09 per share, consistent with the Company's fiscal 2010 annual dividend target of $0.36, payable on December 30, 2009 to shareholders of record as of December 15, 2009.

Marc A. Cohen, OPNET's Chairman and CEO, stated, "We are very pleased to report strong sequential improvement in both license revenue and profitability. License revenue grew 30.9%, or $2.8 million over last quarter, and operating margin grew from negative 2.3% to positive 7.2% over last quarter. We also ended the quarter with record deferred revenue of $34.9 million. While we have seen a loosening up of budgets and more normal buying patterns compared to the June quarter, concerns about the longer term recovery continue to put pressure on purchase decisions. As expected, Q2 was a strong federal government quarter as a result of fiscal year-end spending."

Mr. Cohen continued, "Overall we saw a significant improvement in deal closure rates. Application performance management (APM) continues to be a growth area for the Company, and hit a new record in license bookings. Also in Q2, we released ACE Live VMon, a new APM solution that extends real time performance monitoring and troubleshooting into virtualized environments. We believe that our end-to-end APM solutions which cover networks, applications, and systems provide us with a significant competitive advantage that will drive market share growth, and even more so in an environment where businesses are looking to consolidate and reduce costs. Provided the economy continues to improve, we believe that our positioning will generate sustained license revenue growth and profitability."

The Company's second quarter fiscal 2010 financial results are presented below. The non-GAAP results exclude the income statement effects of stock-based compensation and acquisition-related amortization of intangible assets. A reconciliation of GAAP results to non-GAAP results has been provided in the financial statement table following the text of the press release. For further information, please refer to the section of the press release titled "Use of Non-GAAP Measures."

GAAP Financial Highlights for the Second Quarter of Fiscal 2010:

 * Total revenue decreased year-over-year 5.3% to $30.6 million
   from $32.4 million for the same quarter of fiscal 2009.  Total
   revenue for the quarter increased sequentially 10.5% from
   $27.7 million for the first quarter of fiscal 2010.
 * License revenue decreased year-over-year by 16.7% to
   $11.7 million from $14.0 million for the same quarter of fiscal
   2009.  License revenue for the quarter increased sequentially
   30.9% from $8.9 million for the first quarter of fiscal 2010.
 * Deferred revenue increased to a record $34.9 million at quarter
   end, a 17.7% increase year-over-year from $29.7 million at the
   end of the same quarter of fiscal 2009 and a 5.1% increase
   sequentially from $33.2 million at the end of the first quarter
   of fiscal 2010.
 * Gross margin decreased year-over-year to 74.7% from 75.8% for
   the same quarter of fiscal 2009.  Gross margin increased
   sequentially from 71.9% in the first quarter of fiscal 2010.
 * Operating margin decreased year-over-year to 7.2% from 9.6% for
   the same quarter of fiscal 2009.  Operating margin increased
   sequentially from negative 2.3% in the first quarter of fiscal
   2010.
 * Earnings per share decreased year-over-year to $0.07 from $0.10
   for the same quarter of fiscal 2009.  Earnings per share
   increased sequentially from a loss of $0.02 in the first quarter
   of fiscal 2010.

Non-GAAP Financial Highlights for the Second Quarter of Fiscal 2010:

 * Non-GAAP gross margin decreased year-over-year to 76.3% from
   77.7% for the same quarter of fiscal 2009.  Non-GAAP gross
   margin increased sequentially from 73.6% in the first quarter of
   fiscal 2010.
 * Non-GAAP operating margin decreased year-over-year to 9.8% from
   13.0% for the same quarter of fiscal 2009.  Non-GAAP operating
   margin increased sequentially from 1.0% in the first quarter of
   fiscal 2010.
 * Non-GAAP earnings per share decreased year-over-year to $0.09
   from $0.13 for the same quarter of fiscal 2009.  Non-GAAP
   earnings per share increased sequentially from $0.01 in the
   first quarter of fiscal 2010.

Third Quarter Fiscal Year 2010 Financial Outlook

OPNET currently expects fiscal 2010 third quarter GAAP revenue to be between $30.5 million and $32.5 million, and GAAP diluted earnings per share to be between $0.03 and $0.09. These estimates represent management's current expectations about the Company's future financial performance, based on information available at this time.

OPNET will hold an investor conference call on Thursday, October 29, 2009 at 5:00 pm Eastern Time to review financial results for the second quarter of fiscal 2010.

To listen to the OPNET investor conference call:

 * Call 888-352-6795 in the U.S. or 719-867-0353 for international
   callers, or
 * Use the webcast at www.opnet.com.  Investors are advised to go
   to the web site at least 15 minutes early to register, download,
   and install any necessary audio software.

To listen to the archived call:

 * Call the replay phone number at 888-203-1112 or 719-457-0820 for
   international callers. For replay, enter passcode # 5524020.
   The replay will be available from 7:00 pm Eastern Time
   October 29th through Midnight Eastern Time November 4th.
 * The webcast will be available at www.opnet.com, archived for
   seven days.

Use of Non-GAAP Measures

OPNET uses a variety of financial measures that are not in accordance with generally accepted accounting principles, or GAAP, as supplemental measures to GAAP to evaluate its operational performance. These financial measures, which include non-GAAP gross profit, non-GAAP operating income, non-GAAP operating margin, non-GAAP net income and non-GAAP diluted earnings per share, exclude the impact of certain items and, therefore, have not been calculated in accordance with GAAP. A detailed explanation of each of the adjustments to such financial measures is described below. A reconciliation of each of these non-GAAP financial measures to its most comparable GAAP financial measure is also included below.

Management uses non-GAAP financial measures (a) to evaluate OPNET's historical and prospective financial performance as well as its performance relative to its competitors, and (b) to measure operational profitability and the accuracy of forecasting. In addition, many financial analysts who follow OPNET focus on and publish both historical results and future projections based on non-GAAP financial measures. OPNET believes that it is in the best interest of its investors to provide this information to analysts so that they accurately report the non-GAAP financial information. Moreover, investors have historically requested these non-GAAP financial measures as a means of providing consistent and comparable information with past reports of financial results.

While management believes that these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of these non-GAAP financial measures.