Cognos expects second quarter earnings to exceed company outlook

"The plan will allow us to continue investing in our growth opportunity, while improving efficiency and accelerating our operating margin improvement," said Rob Ashe, Cognos president and chief executive officer. "We remain focused on executing on our strategy for market leadership and investment in customer success as we move forward."

The company's operating margin improvement plan includes a workforce realignment to enhance organisational agility and remove management layers and continued investment in customer-facing operations, including sales and professional services. The company expects cost savings of approximately US $28 million on an annualised basis and $13 million in the remaining half of fiscal year 2007.

Based on preliminary financial data, the company expects revenue for the second quarter to be around $228 million. License revenue is expected to be in the range of $77 million to $78 million.

"We are very confident in the strength of our market opportunity, our company and our solutions. We had a good quarter, and, while a workforce reduction is difficult, we are determined to drive higher operating margin performance going forward."

"The Middle East is a key target market for Cognos," said Graham Walter, vice-president, Cognos UK, Middle East, and South Africa.

"We have registered exponential growth in the region and, to support our operations, we are expanding our dedicated local presence in target markets. The value we add to our partners comes from our in-depth technological expertise, and we are now in a position to offer sophisticated and strategic support to all our clients in the region."