ESI reports Q3 revenue up 10%

ESI Group reported today that third quarter 2011 revenue was €17.6 million, up 10% both as reported and in constant currencies on strong demand for its services offerings.  ESI CEO Alain de Rouvray said that the third quarter results “show the offensive and defensive quality of our activity and attest to the high degree of innovation that we bring to our business.” The company reports that license revenue in Q3 was €11.5 million, up 8% while services revenue was €6.1 million, up 13%. Strongest growth was seen in Europe, up 26%, most notably in Central Europe and Germany. As a reminder, ESI bought IC.IDO in late August, so these results include 2 months of consolidated revenue. IC.IDO contributed about €700,000 to revenue in Q3, meaning that ESI core growth was about 6%. Yesterday’s acquisition, Efield, is not included in these results. For the first nine months of the year, ESI says that revenue from Europe grew 19%, while Asia was up nearly 8%. Revenue from the Americas “continued to be affected by a negative exchange rate”. ESI didn’t give any more details but last year, revenue from the Americas was €19 million (up 13%). All indications from ESI appear to signal softness in the region for the year to date — but ESI’s revenue is heavily skewed towards license renewals in the fiscal fourth quarter, so we shouldn’t read too much into the performance to date. ESI does not give forward-looking guidance but its highly repeatable revenue model does offer hints as to what’s coming. Q4 revenue has typically been more than double that of Q3, accounting for over 40% of total revenue last couple of years. If that pattern holds for 2011, total revenue should be about €38 million, for an annual total of €90 million or so — or up about 10%. That’s if prior patterns repeat.