FileNet Stock Surges as Tech Companies in O.C. Turn in Strong Quarterly Reports

Several Orange County technology companies reported impressive quarterly earnings that helped boost their stock prices Tuesday, part of a wider pattern that saw tech companies meet or exceed analysts’ estimates this week.

FileNet Corp.’s stock surged Tuesday after the software maker posted record fourth-quarter net income that trounced analysts’ expectation.

The company, a provider of Web content management software, said fourth-quarter net income surged 63% to $14.8 million, or 40 cents a share, from $9.1 million, or 26 cents a share, a year ago. Analysts had expected the Costa Mesa company to log earnings of 33 cents a share, according to a survey by First Call/Thomson Financial.

Revenue rose 19% to $111.6 million.

The stock moved up nearly 29%, or $6.31 a share, to $28.38, in Nasdaq trading. The shares remain below their 52-week high of $46.81.

“It’s the best year in the history of the company,” said Lee D. Roberts, chief executive and chairman.

The key driver in the company’s growth was a set of Web software products that Wall Street originally expected would bring $45 million in revenue to the company last year. Instead, the company expects sales to exceed $105 million, Roberts said.

For the year, net income nearly doubled to $38.5 million, or $1.05 a share, from $19.7 million, or 59 cents a share, in 1999. Revenue climbed 15% to $398.6 million.

FileNet expects to maintain a Street earnings estimate of $1.25 to $1.32 a share for 2001, Roberts said. Revenue is expected to range between $400 million and $450 million, he added.

The company ended the year with $139.5 million in cash and investments and no long-term debt.

FileNet plans several strategic acquisitions to reach its goal of doubling the company in size over the next four years, Roberts said.

“There are a lot of targets out there due to the changing market capitalization of companies,” said Roberts, declining to elaborate.

He doesn’t see a slowing economy stalling his company’s plans to grow, however. “Information technology spending is slowing down, but it isn’t stopping,” he said.

Intersil Holding Corp., an Irvine wireless-communications chip maker, reported fourth-quarter net income of $27.9 million, or 26 cents a share, compared with a loss of $500,000 in the same period a year earlier. That income, which is also before amortization, beat analysts’ expectations by 2 cents.

Revenue grew by 37% to $216.8 million; Intersil said its outlook is for about 25% growth in the first quarter and 20% growth for 2001.

Its stock rose $2.75 to close at $32 a share on Nasdaq.

Powerwave Technologies Inc., an Irvine supplier of power amplifiers for wireless-communications networks, reported fourth-quarter net income of $12.4 million, or 19 cents a share, 48% higher than the $8.4 million, or 13 cents a share, posted for the previous year’s final three months.

Quarterly sales increased 33% to $121.2 million.

For the year, net income more than doubled to $45.7 million, or 71 cents a share, from $20.3 million, or 33 cents a share, for the prior year. Revenue grew 53% to $447.4 million.

Powerwave’s stock jumped $4.31 to close at $44.06 on Nasdaq.

Microsemi Corp., a Santa Ana semiconductor company, reported net income of $4.1 million, or 28 cents a share, for its fiscal first quarter, ended Dec. 31. That compares with net income of $966,000, or 9 cents a share, for its first quarter the previous year. Sales increased 15% to $63 million.

Microsemi said it expects second-quarter revenue of $63 million to $68 million and projects full-year revenue of $270 million to $290 million. It expects that the shift to higher-margin sales will continue for the remainder of the year.

Gross profit margins should improve one-quarter to three-quarters of a percentage point each quarter for the remainder of its fiscal year, it said, because of the company’s growth and the impact from the revenue shift.

Its stock hit a 52-week high of $52 a share before dipping a bit to close at $51 a share, up $2.50 on Nasdaq.

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Reuters and Dow Jones newswires were used in compiling this report.