Check Point Software Technologies Inc (CHKP)

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Check Point misses 2005 forecasts

30.1.06 | 11:31 By Omer Sharvit
Exactly a year ago, Check Point Software Technologies (NASDAQ: CHKP) guided investors to expect 13.5%-16.4% revenue growth in 2005. It didn't make it.

Revenues were supposed to be in the range of $585 million to $600 million. The data security company today admitted that in practice, its turnover for the year is $579.4 million, an increase of 12% from $515.4 million in 2004.

Its growth is slower, too. In 2004, turnover had increased by 19%, sending its stock climbing 46%. In 2005, its growth slowed to 12% and its stock sank 19%.

Check Point stock from 2003
The slowdown in growth worsened as 2005 wore in. In the fourth quarter of 2004, revenue growth had been 24%, but in the first quarter of 2005, it was 19%. In the second quarter its growth slowed to 14% and in the third quarter, it was all of 9%.

Fourth-quarter 2005 revenues increased 9% against the parallel quarter of 2004 to $156.1 million, Check Point said.

Analysts had on average expected pro forma EPS of 35 cents per share, and revenues of $158.4 million.

It netted $89.2 million in the last quarter of 2005, or 36 cents per share, versus $76.4 million in the same period of 2004.

Minus one-time costs, its pro forma net was 37 cents per share.

Three months ago Check Point had guided investors to expect revenues in the range of $155-164 million in the last quarter, and pro forma earnings of 34-37 cents per share.

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