Sunday, May 7, 2006

Ditech Raises Financial Outlook

Ditech Communications raised its financial guidance, saying it now expects revenue for the fourth quarter of its fiscal 2006 ending April 30, 2006 to be approximately $20 million, up 43% from the third quarter fiscal 2006 revenues of $14 million.

The company expects gross margins will be in the range of 70-71% with operating expenses in the range of $11.6 million - $11.9 million. As a result, diluted earnings per share are expected to be in the range of $0.06 - $0.07.

"Our fourth quarter results were outstanding and reflected progress in all areas of our business," said Tim Montgomery, president and CEO of Ditech Communications. "We grew our core North American voice processing business with further deployment of our industry leading Broadband Voice Processor platform. We accelerated our fourth quarter momentum with international sales and installations of our VQA - Voice Quality Assurance products. We also saw traction in our VoIP offerings. I wish to thank all of our employees for their dedication and successful execution on all fronts."

Based upon expected bookings, timing of shipments and deferred revenues, Ditech Communications expects revenues in the first quarter of fiscal 2007 to increase approximately 10% over revenues of the fourth quarter of fiscal 2006. Gross margins are expected to be flat to slightly down due to product and geographic mix.

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