R "Ray" Wang
R "Ray" WangIPO Watch: Deltek Files S-1
After much anticipation since New Mountain funds took the company private with a 75% stake in 2002, Herndon based Deltek Systems filed its S-1 on May 8th 2007. As a Project Based Solution (PBS) vendor, nothing could be more fitting than coming out with the NASDAQ symbol "PROJ". While private, Deltek remained active and acquired Wind 2 in 2005 and Welcom in 2006 leading to a doubling of its size and customer base. The results of this acquisition and maintenance strategy speak for themselves -- software license growth up 215.7%, maintenance increases of 89.1%, and overall revenues up 153.33% since 2002 (see Figure 1.) Key to Deltek's future will be the expansion into new vertical areas beyond its strengths in public sector, A/E/C, non-profit, and research. Deltek's key competitors include industry stalwart Primavera, .NET competitor Epicor, and Microsoft with its Project and Solomon offerings.
Figure 1. Deltek Consolidated Financials as Filed in S-1
| 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||
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Statement of Operations Data: |
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REVENUES: |
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Software license fees |
$ | 23,742 | $ | 36,636 | td> | $ | 34,934 | $ | 45,923 | $ | 74,958 | |||||||||
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Consulting services |
18,063 | 22,842 | 28,585 | 41,212 | 66,573 | |||||||||||||||
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Maintenance and support services |
43,987 | 47,778 | 54,178 | 63,709 | 83,172 | |||||||||||||||
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Other revenues |
4,512 | 2,091 | 3,516 | 2,112 | 3,565 | |||||||||||||||
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Total revenues |
90,304 | 109,347 | 121,213 | 152,956 | 228,268 | |||||||||||||||
As the Project Based Solutions (PBS) space heats up, expect rapid consolidation in the next 3 years among vendors such as Agresso, Artemis Software, Augeo Software, BST Global, CA (Computer Associates)Niku, Computer Methods International Corp. (CMiC), Deltek, Dexter & Cheney, Epicor Software, IFS, Lawson, Maconomy, Maxwell Systems, Mercury Software, Meridian Systems, Microsoft Dynamics, Oracle, OpenAir, Pacific Edge, Planisware, PlanView, Primavera Systems, ProSight, Sage Software, SAP, Softrax, Tenrox, and Viewpoint Software (formerly BidTek). According to Forrester Research, the PBS market is expected to grow to $6.5B by 2010.
(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2007 by R Wang. All rights reserved