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OPNET Technologies Inc. (OPNT) filed Quarterly Report for the period ended 2011-12-31.
Opnet Technologies Inc. has a market cap of $854.9 million; its shares were traded at around $37.98 with a P/E ratio of 46.9 and P/S ratio of 5.8. The dividend yield of Opnet Technologies Inc. stocks is 1.3%.
This is the annual revenues and earnings per share of OPNT over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of OPNT.
Highlight of Business Operations:
Professional services revenue was $5.8 million and $5.6 million for the three months ended December 31, 2011 and 2010, respectively, representing an increase of 3.9%. Consulting services revenue accounted for 94.8% and 97.6% of professional services revenue for the three months ended December 31, 2011 and 2010, respectively. The percentage of total consulting revenue from United States government customers for the three months ended December 31, 2011 and 2010 was 50.3% and 62.8%, respectively. Professional services revenue was $17.8 million and $16.8 million for the nine months ended December 31, 2011 and 2010, respectively, representing an increase of 6.4%. Consulting services revenue accounted for 97.3% and 97.8% of professional services revenue for the nine months ended December 31, 2011 and 2010, respectively. The percentage of total consulting revenue from United States government customers for the nine months ended December 31, 2011 and 2010 was 51.9% and 68.8%, respectively. The increase in professional services revenue for the three and nine month periods ended December 31, 2011 was principally the result of an increase in average hourly billing rates for our consultants that provide consulting services. The increase in average hourly billing rates was due to an increase in the percentage of our revenue being derived from commercial customers as compared to United States government customers during the three and nine month periods ended December 31, 2011 as compared to the prior fiscal year. The increase in the percentage of professional services revenue derived from commercial customers for the three and nine month periods ended December 31, 2011, as compared to the same periods in the prior fiscal year, was principally due to the growing proportion of product sales and related implementation services to corporate enterprise customers relative United States government customers. Average hourly billing rates for consulting services are generally higher for commercial customers than for United States government customers.Cost of Product Revenue. Cost of product revenue was $4.3 million and $2.9 million for the three months ended December 31, 2011 and 2010, respectively. The increase of 49.3% was principally the result of a $1.6 million increase in costs related to hardware platforms used to deliver our AppResponse Xpert software products and other hardware used in conjunction with our AppResponse Xpert software products. The increase in hardware costs reflects growth in sales of our AppResponse Xpert products. Total hardware platform costs for the three months ended December 31, 2011 and 2010 was $3.9 million and $2.4 million, respectively. Gross margin on product revenue decreased to 82.3% for the three months ended December 31, 2011, compared to 85.7% for the same period in fiscal 2011. The decrease in gross margin was due to a higher proportion of product revenue being generated from sales of our AppResponse Xpert product, which is typically delivered using a hardware platform and therefore has a higher cost of revenue as compared to other software products we sell. The higher proportion of AppResponse Xpert revenue was largely due to an increase in the quantities of AppResponse Xpert products sold to existing customers, as existing customers typically purchase larger quantities of our AppResponse Xpert products as compared to new customers. Cost of product revenue was $10.7 million and $6.7 million for the nine months ended December 31, 2011 and 2010, respectively. The increase of 60.6% was primarily the result of a $3.6 million increase in costs related to hardware platforms used to deliver our AppResponse Xpert software and other hardware used in conjunction with AppResponse Xpert. Total hardware platform costs for the nine months ended December 31, 2011 and 2010 was $9.2 million and $5.6 million, respectively. Gross margin on product revenue decreased to 83.4% for the nine months ended December 31, 2011, compared to 86.9% for the same period in fiscal 2011. The decrease in gross margin was due to a higher proportion of product revenue being generated from sales of our AppResponse Xpert product, which is typically delivered using a hardware platform and therefore has a higher cost of revenue as compared to other software products we sell. The higher proportion of AppResponse Xpert revenue was largely due to an increase in the quantities of AppResponse Xpert products sold to existing customers, as existing customers typically purchase larger quantities of our AppResponse Xpert products as compared to new customers. In addition, during the quarter ended September 30, 2011, we extended a larger than normal discount to one customer that made a very significant purchase of AppResponse Xpert products.
Cost of Product Updates, Technical Support and Services Revenue. Cost of product updates, technical support and services revenue was $1.5 million and $1.3 million for the three months ended December 31, 2011 and 2010, respectively. The increase in cost of product updates, technical support and services revenue was primarily the result of compensation costs associated with providing when-and-if-available training under our maintenance contracts. Gross margin on product updates, technical support and services revenue decreased to 90.6% for the three months ended December 31, 2011, from 90.9% for the same period in fiscal 2011. Stock-based compensation expense allocated to cost of product updates, technical support and services was $11,000 and $6,000 for the three months ended December 31, 2011 and 2010, respectively. Cost of product updates, technical support and services revenue was $4.3 million and $3.8 million for the nine months ended December 31, 2011 and 2010, respectively. The increase in cost of product updates, technical support and services revenue was primarily the result of compensation expense related to an increase in providing when-and-if available training under our maintenance contracts and customer support. Gross margin on product updates, technical support and services revenue increased to 90.6% for the nine months ended December 31, 2011, from 90.3% for the same period in fiscal 2011. Stock-based compensation expense allocated to cost of product updates, technical support and services was $27,000 and $14,000 for the nine months ended December 31, 2011 and 2010, respectively.
Cost of Professional Services Revenue. Cost of professional services revenue was $4.1 million and $3.7 million for the three months ended December 31, 2011 and 2010, respectively. The increase of 10.5% was primarily the result of an increase in compensation expense related to annual raises and an increase in discretionary compensation. Gross margin on professional services revenue decreased to 29.9% for the three months ended December 31, 2011 from 34.0% for the same period in fiscal 2011. Stock-based compensation expense allocated to cost of professional services was $16,000 and $19,000 for the three months ended December 31, 2011 and 2010, respectively. Cost of professional services revenue was $11.7 million and $12.2 million for the nine months ended December 31, 2011 and 2010, respectively. The decrease of 4.0% was primarily the result of a $326,000 decrease in expense related to third-party contractors and a $269,000 decrease in facility costs. Gross margin on professional services revenue increased to 34.5% for the nine months ended December 31, 2011 from 27.4% for the same period in fiscal 2011. Stock-based compensation expense allocated to cost of professional services was $54,000 and $56,000 for the nine months ended December 31, 2011 and 2010, respectively. The increase in the gross margin for the nine months ended December 31, 2011 as compared to the prior fiscal year was due to a larger percentage of our revenue being derived from commercial customers. Average hourly billing rates are generally higher for commercial customers than for United States government customers. The decline in the percentage of professional services revenue from United States government customers for the three and nine month periods ended December 31, 2011, as compared to the same periods in the prior fiscal year, is principally due to the growing proportion of product sales and related implementation services to corporate enterprise customers relative to United States government customers.
Sales and Marketing. Sales and marketing expenses were $14.9 million and $13.3 million for the three months ended December 31, 2011 and 2010, respectively. The increase of 12.5% was largely due to a $1.4 million increase in compensation and sales commissions resulting from sales growth, and a $110,000 increase in travel expense related to an increase in sales activities following the global economic downturn. Stock-based compensation expense allocated to sales and marketing was $169,000 and $165,000 for the three months ended December 31, 2011 and 2010, respectively. Sales and marketing expenses were $41.0 million and $35.1 million for the nine months ended December 31, 2011 and 2010, respectively. The increase of 16.7% was largely due to a $4.6 million increase in compensation and sales commissions resulting from sales growth, a $505,000 increase in travel expense, and a $260,000 increase in conference and trade show expenses resulting from more normalized sales activities and marketing expenditures following the global economic downturn. Stock-based compensation expense allocated to sales and marketing was $447,000 and $357,000 for the nine months ended December 31, 2011 and 2010, respectively.
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