InfoVista Reports Q3 FY07 Financial Results

Paris, France and Herndon, VA (United States), April 26, 2007 – InfoVista (Euronext: IFV, ISIN: FR0004031649), the leading service-centric performance management software company, today announced financial results for its third quarter ended March 31, 2007.

Total revenues amounted to €9.6 million, a 7% decline over the same period last year. Net loss for the quarter stood at € 1.3 million, compared to break even in the same quarter last year.
Commenting on InfoVista’s performance in the period, Alain Tingaud, Chairman & Chief Executive Officer, noted: “Our poor performance in Q3 stemmed from significant weakness in license revenues in North America, which offset a satisfactory performance in Europe and Asia. During the quarter, we took decisive steps to rectify the situation by strengthening the way in which we market ourselves to service providers and large enterprises. We also took actions to reduce costs, the benefits of which will begin to flow in Q4. I am confident in the commitment of all our employees and I am convinced that we will be updating you on our positive progress in due course.”


Financial Highlights

Revenues

* Total revenues in the third quarter declined 7% to €9.6 million. License revenues declined by 24% year-on-year to €4.6 million, representing 48% of total revenues. Service revenues grew 19% to €5.0 million for the third quarter.

Expenses

* Gross margin in the third quarter stood at 79.9% of total revenues, compared to 80.4% in the comparable quarter of the previous year. Despite the large drop in license revenues, the decline in overall gross margin remained limited, reflecting solid margins in service activities.
* Third quarter operating expenses excluding one-off items were flat at €8.4 million. Research and development costs rose by nearly €0.2 million, while sales and marketing costs declined slightly. General and administrative (G&A) costs remained flat.
* In the third quarter, InfoVista incurred one-off charges for a total of approximately €0.7 million, primarily due to €0.5 million in severance and stock-based compensation charges related to the termination of employees, including the former CEO. During the quarter, the Company announced its decision to delist from NASDAQ, resulting in charges of approximately €0.2 million. Going forward, the Company expects G&A savings of nearly €0.3 million per quarter as a result of these measures.
* The Company had 231 employees at the end of March 2007, as compared to 219 employees a year ago.

Earnings

* In Q3, InfoVista had a net loss of €1.3 million, as compared to net income of €51 thousand in Q3 of the previous year.

Balance Sheet as of March 31, 2007

* Days Sales Outstanding (DSOs) stood at 93 days as compared to 90 days at the end of December 2006.
* Deferred revenue stood at €6.9 million.
* Total cash and marketable securities stood at €36.4 million as compared to €33.5 million a quarter ago. The increase in the cash position is primarily due to stock options that have been exercised during the quarter.
* The Company remains debt free.
* There were a total of 18,603,486 InfoVista shares outstanding at March 31, 2007.


Operational Highlights

Satisfactory performance in Europe and Asia offset by poor results in North America

* In America, total third quarter revenues declined by 31% year-on-year to €3.8 million. InfoVista sales strategy in North America was poorly executed and this was the primary reason for the year-on-year decline. During the quarter, the Company took the necessary steps by refocusing the appropriate resources on InfoVista’s core business markets: service providers, MSPs and large enterprises.
* In the EMEA region, total revenues rose by 6% year-on-year to €4.2 million in the quarter. The Company extended its business in South Africa and Italy, and gained traction in Germany.
* In Asia Pacific, total revenues more than doubled year-on-year to €1.6 million in the quarter. InfoVista confirmed its leading position in Australia as it secured a €0.7 million win with one of the leading service providers in the region.
* EMEA, America and Asia-Pacific contributed 44%, 40% and 16%, respectively, to the third quarter’s total revenues.
* Revenues from the direct sales channel totaled €5.8 million in the third quarter, accounting for 61% of the total. Indirect revenues, generated through partners such as Dimension Data and ONE-ANS, rose by 34% to €3.8 million and contributed 39% of total revenues for the quarter.

Major Wins in the Third Quarter:

* InfoVista’s service provider revenues stood at €5.7 million for the third quarter and represented 60% of total revenues. InfoVista won new service provider accounts such as MTN and Transtel in South Africa and Sirti in Italy. The Company also received numerous repeat orders from existing customers such as Optus and AAPT in Australia and Vodafone Italy.
* InfoVista’s enterprise revenues increased 83% year-on-year to €3.9 million in the third quarter, including €1.5 million from the multi-million dollar deal signed with Microsoft. During the quarter, InfoVista also secured deals from various financial institutions, including Bank of Japan, JP Morgan and Crédit Agricole.

Expanding InfoVista’s Research and Development

* Recently, InfoVista announced the release of VistaInsight for IP Telephony 3.0, the newest version of its award-winning performance management solution for IP telephony. The Company also announced the release of VistaWatch 2.2, the next version of InfoVista’s end-to-end monitoring solution, expanding the suite’s range to include Session Initiation Protocol (SIP)-based applications such as integrated instant messaging, IP voice, IP video and web-conferencing.
* Also this quarter, InfoVista announced VistaInsight® for Networks 2.2 Service Provider Edition, an end-to-end performance management solution with enhanced capabilities for cable providers targeting two key markets: triple play consumer and commercial services. The new solution helps Cable Multiple System Operators (MSOs) simultaneously manage competitive broadband, Voice over IP (VoIP) and digital video services to a growing number of residential and commercial customers.

Frost & Sullivan’s 2006 Global Award

* InfoVista received Frost & Sullivan’s 2006 Global Award for Product Differentiation Innovation and was named the market leader in this award category for the network performance management and monitoring market.

Cancellation of shares

* Following an authorization from the shareholders meeting held on December 15, 2006, the Board has decided, on April 25, 2007, to cancel 700,000 shares in treasury stock, in order to favor an accretive effect for the shareholders.



Outlook
In line with the previously announced guidance, InfoVista’s management continues to expect total revenues for the year ending June 30, 2007 to be at €40 million with a net loss of €1 million. In the fourth quarter, InfoVista expects a breakeven position on total revenues of between €10 million to €10.5 million.

Conference call details
InfoVista will host an investor conference call today, Thursday 26 April 2007 at 8.30 a.m. (EST) / 1.30 p.m. (UK) / 2.30 p.m. (Continental Europe). The call will be available by dialing +33 (0)1 70 99 42 70 in France, +44 (0)20 7138 0824 in the UK, or +1 718 354 1158 in North America. A replay will be available shortly after the end of the call at the following numbers: France: +33 (0)1 71 23 02 48, UK: +44 (0)20 7806 1970, North America: +1 718 354 1112. The replay passcode is: 8123942#. In order to ensure that a line is available for you, please register by clicking on the following link (InfoVista Q3 2006/2007).

Please note that InfoVista will be holding a SFAF meeting in Paris on the morning of June 6th 2007. Please save the date and more details will follow in due course. Thank you.


Download the CONSOLIDATED STATEMENTS OF OPERATIONS and CONSOLIDATED BALANCE SHEETS (pdf): www.infovista.com/about_infovista/news/press_releases/en/releases/Q3_FY07_english_PR.pdf


About InfoVista
InfoVista is the Service-Centric Performance Management Software Company that assures the optimal delivery of business-critical IT services. Driven by a uniquely adaptive and real-time technology foundation, InfoVista solutions improve business effectiveness, reduce operating risk, lower cost of operations, increase agility and create competitive advantage. Eighty percent of the world’s largest service providers as ranked by Fortune®, as well as leading Global 2000 enterprises, rely on InfoVista to enhance the business value of their technology assets. Representative customers include ABN AMRO, Allstream, Banques Populaires, AXA, Banque de France, Bell Canada, British Telecom, Broadwing Communications, Cable & Wireless, Com Hem, Defense Information Systems Agency (DISA), Deloitte & Touche, Deutsche Telecom, France Telecom, Savvis Corporation, SingTel, Telefonica, and US Cellular. A Software Magazine 500 company, InfoVista stock is traded on the Eurolist by Euronext (FR0004031649). For more information about the company, please visit www.infovista.com.

Cautionary Remarks Regarding Forward-looking Statements
Except for information regarding historical facts, the matters discussed in this presentation are “forward looking statements.” These statements reflect management’s beliefs and best judgment based on currently available information and expectations. However, the forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those anticipated by such forward-looking statements. In particular, statements of management’s outlook assume that overall market demand for our products will remain approximately at recent levels and that we will maintain our market position despite intense competition; statements of management’s outlook also do not take into account fluctuations which may occur in currency exchange rates, particularly as between the euro and the U.S. dollar. In addition, actual results may differ from those presented in the forward-looking statements due to other risks and uncertainties involved in our business, including, without limitation, the rapid evolution of our markets, our ability to attract new customers for our products, our dependence upon spending by the telecommunications industry, the technical success and reliability of our products and our ability to develop and protect new technologies. For more information regarding the factors which may affect our results and operations, see the disclosures in InfoVista’s public filings with the US Securities & Exchange Commission and the French Autorité des Marchés Financiers, including the “Risk Factors” section in our Annual Report on Form 20-F. Undue reliance should not be placed on any forward-looking statement included in this presentation. InfoVista undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

InfoVista is a registered trademark of InfoVista, S.A.

Contact Information

Karena D’Arcy

Investor Relations Manager

InfoVista, S.A.

Contact via E-mail