Rand reports growth, shareholders like

Rand Worldwide, the entity created last year by the reverse merger of Rand and Avatech, today reported total third quarter revenue of $27.4 million, up handily from the $13.5 million reported by Rand alone a year ago. My notes show that Avatech reported revenue of $8.4 million in its March quarter, which would make a more reasonable comparison be between this year’s reported $27.4 million and my pro forma $21.9 million for 2010 — impressive growth either way.

Back to the new Rand. The company reported product sales of $16.3 million, services revenue of $5.4 million and commission revenue of $5.6 million. Comparisons to 2010 are difficult because of the merger but CEO Mark Dulude said that these results reflect how well the two companies are being integrated and that synergies are being realized in the merged entity. CFO Larry Rychlak said that Q3 surpassed internal expectations for both revenue and income.

For its fiscal Q3, Rand reported net income of $2.1 million, compared with a loss of $620,000 a year ago.

Mr. Dulude offered some color on elements of the business: Customers in the March quarter were more willing to spend to improve business operations. Q3’s strong revenue was driven by IMAGINiT, Rand’s Autodesk-related business. IMAGINiT’s services business saw “significant revenue growth” across all of its verticals. Mr. Dulude said the relationship with Autodesk is “strong and positive”.

The analyst on the call gushed about the results, then asked about Rand’s future. Mr. Dulude focused his reply on how the company might expand the non-Autodesk portion of the business, saying that acquisitions and other ways of growing the company are all possibilities.

Mr. Rychlak and Mr. Dulude both cautioned that the company’s fourth quarter (ending in June) is not typically the strongest of Rand’s year and that the pace of selling has slowed. But both also said that this reflects typical seasonality, and that the company remains optimistic of its prospects in an economic recovery.