Forrester Research (FORR) Q4 1998 earnings summary

Executive summary

• FY98 revenue rose 52% to $61.6M; operating income increased to $9.2M and net income to $7.5M. Agreement value reached $69.1M, up 48% YoY.

• Growth reflected more clients, added research services, stronger advisory demand, international expansion, and new e-commerce and consumer research offerings.

Financial highlights

• Revenue was $61.567M, operating income $9.182M, net income $7.547M, basic EPS $0.89 and diluted EPS $0.81 in FY98.

• Core research revenue grew 54% to $46.8M; advisory services and other revenue increased 47% to $14.7M YoY.

• Operating expenses rose 56% to $52.4M; cost of services and fulfillment increased 61% to $22.0M, while selling and marketing rose 47% to $20.9M.

• Cash from operations was $12.3M, versus $11.9M in FY97; year-end cash and cash equivalents were $10.4M and marketable securities $56.1M.

Outlook and guidance

• 1999 priorities: ongoing European development, expanded research coverage, seven worldwide Forums, and launch of eResearch.

• Research staff in Europe expected to double in 1999, supporting two new research areas; U.S. coverage planned to expand in technology services and outsourcing, supply chain technology, and Web design.

• Planned product and infrastructure investment over the next 3–12 months; existing liquidity and operating cash flow expected to cover requirements for at least two years.