ESI Group today reported revenue growth of 2% to EU70.2 million for the fiscal year ended
January 31, 2009. Excluding acquisitions, revenue declined about 5% from fiscal
2007/2008. Like other engineering software companies, business slowed dramatically
during Q4: ESI reports a 35% drop in new business leading to a 7% drop in license
revenue during Q4. The results are disappointing after a strong start saw revenue up 5% in
the first nine months.
In the earnings press release, Alain de Rouvray, ESI Group’s Chairman and CEO, is
quoted as saying: “Over the fourth quarter, we noted a sudden fall in activity after a positive
first 9 months … The brutal downturn in the economic situation over the fourth quarter
resulted in a slowdown in new investments, specifically in Asia, which led to sales below
expectations. Beyond the figures themselves, the positive renegotiation of contracts for
the annual rental of licenses … highlights the solidity of our business model." More details
will be available April 29, when the company files its formal annual results.