Asia PR News

OTTAWA and BURLINGTON, Mass., March 30 /PRNewswire-AsiaNet/ –

Cognos delivers $117.9 million of license revenue

Cognos Incorporated (Nasdaq: COGN; TSX: CSN) (all figures in U.S. dollars
and in accordance with U.S. GAAP), the world leader in business intelligence
(BI) and corporate performance management (CPM) solutions, today announced
financial results for its fourth quarter and full fiscal year 2006, ended
February 28, 2006.

Revenue for the fourth quarter was $253.1 million, compared with $256.3
million for the same period of last fiscal year. License revenue was $117.9
million, compared with $129.9 million in the fourth quarter of last fiscal
year. Net income in the quarter was $44.0 million or $0.48 per diluted share,
compared with $54.3 million or $0.58 per diluted share for the same period
last fiscal year.

Revenue for the full fiscal year 2006 was $877.5 million, compared with
$825.5 million for the previous fiscal year. Net income for fiscal year 2006
was $124.8 million, or $1.35 per diluted share, compared with the prior year’s
net income of $136.6 million, or $1.47 per diluted share.

"These results represent solid performance," said Rob Ashe, Cognos
president and chief executive officer. "Overall license revenue of $117.9
million, inclusive of Cognos 8 license revenue of $55.5 million, 18 seven-
figure contracts, and several major competitive wins all underscore the
strength of our performance this quarter. Cognos 8 is setting the agenda for
the BI market and establishing itself as the platform of choice for BI
standardization."

"The Cognos team executed well this quarter," Mr. Ashe continued. "Our
market leading solutions for BI and Performance Management position us
strongly in this dynamic market. The recent release of Cognos 8 MR1, the
launch of our ground-breaking Search solution — Cognos Go!, and our new
Strategic Global Alliance with IBM set Cognos on course to take full advantage
of the tremendous market opportunity in front of us."

Highlights:

* Fourth quarter license revenue of $117.9 million, up 56 percent from the
third quarter

* Cognos 8 license revenue of $55.5 million in the fourth quarter

* 18 contracts greater than $1 million, compared to 18 for the same period
last year

* 242 contracts greater than $200,000, up 16 percent over the fourth
quarter last year

* Cognos announces Global Strategic Alliance with IBM

* Major Cognos 8 wins at Allianz Life Insurance Company of North America,
BC Hydro, BUPA, Georgia Department of Education, Nestle Suisse S.A.,
Public Works and Government Services Canada, San Diego City Schools, and
State of Ohio Department of Administrative Services

Cognos’ balance sheet remains strong. Operating cash flow was $92.7
million. As a result, the company exited the quarter with $551.0 million in
cash, cash equivalents, and short-term investments.

Business Outlook

Management offers the following outlook for the first quarter of fiscal
year 2007, ending May 31, 2006, inclusive of an after-tax share based
compensation expense of $0.05:

* Revenue is expected to be in the range of $210 million to $218 million;
* Diluted earnings per share are expected to be in the range of $0.15 to
$0.19.

Management offers the following outlook for the full fiscal year 2007,
ending February 28, 2007, inclusive of an after-tax share based compensation
expense of $0.23:

* Revenue is expected to be in the range of $940 million to $960 million;
* Diluted earnings per share are expected to be in the range of $1.20 to
$1.27.

The company’s outlook for the first quarter and full year of fiscal year
2007 assumes no significant changes in the economy, a business intelligence
and corporate performance management market growth rate of approximately 7
percent, a tax rate of 25% for the year, a Canadian dollar of 86 cents U.S.
and a Euro of $1.20 U.S. for the year. In addition, as outlined in a separate
Current Report on Form 8-K filed today with the Securities and Exchange
Commission (also available at
http://www.cognos.com/company/investor/events/fy06q4/sbc_8k.html), Cognos
adopted Statement of Financial Accounting Standard No.123 (revised), Share-
based Payment, ("SFAS 123R") on March 1, 2006, electing to follow the modified
retrospective application method of transition. SFAS 123R requires all
companies to measure compensation costs for all share-based payments
(including stock options) at fair value and recognize such costs in the
statement of income. The adoption of SFAS 123R will impact Cognos’ operating
income, net income and earnings per share.

Cognos management will host a Webcast and conference call to present
results for the fourth quarter of fiscal year 2006 and business outlook at
5:15 p.m. Eastern Time, today, March 30, 2006.

The conference call may be accessed at 416-640-1907. The Webcast and
archive may be accessed at
http://www.cognos.com/company/investor/events/fy06q4. A replay of the
conference call may be accessed at 416-640-1917 until Thursday, April 13, 2006
at 11:59 p.m. Eastern Time. The passcode for the replay is 21174106#.

Safe Harbor for Forward-Looking Statements
Certain statements made in this press release that are not based on
historical information (including those in the section entitled "Business
Outlook") are forward-looking statements which are made pursuant to the safe
harbor provisions of Section 21E of the Securities Exchange Act of 1934 and
Section 138.4(9) of the Ontario Securities Act. Such forward-looking
statements relate to, among other things, the company’s expectations with
respect to revenue and earnings per share for both the first quarter of fiscal
year 2007 and the full fiscal year 2007; the impact of Cognos products and
solutions, including Cognos 8 and Cognos Go!, on the market and Cognos’
position in the market; the impact of Cognos’ Strategic Global Alliance with
IBM; the assumptions made in connection with the business outlook and other
matters. Certain assumptions were applied in making the forward-looking
statements, such as the business outlook and material assumptions are set out
above in the section entitled "Business Outlook".

These forward-looking statements are neither promises nor guarantees, but
involve risks, factors and uncertainties that may cause actual results to
differ materially from those in the forward-looking statements. Factors that
may cause such differences include, but are not limited to: Cognos’ transition
to Cognos 8 and customer acceptance and implementation of Cognos 8; a
continuing increase in the number of larger customer transactions and the
related lengthening of sales cycles and challenges in executing on these sales
opportunities; the company’s ability to identify, hire, train, motivate, and
retain highly qualified management/other key personnel (including sales
personnel) and its ability to manage changes and transitions in
management/other key personnel; the incursion of enterprise resource planning
and other major software companies into the BI market; continued BI and
software market consolidation and other competitive changes in the BI and
software market; currency fluctuations; the impact of the implementation of
SFAS No. 123R; the company’s ability to develop, introduce and implement new
products as well as enhancements or improvements for existing products that
respond to customer/product requirements and rapid technological change; the
impact of global economic conditions on the company’s business; the company’s
ability to maintain or accurately forecast revenue or to anticipate and
accurately forecast a decline in revenue from any of its products or services;
the company’s ability to compete in an intensely competitive market; new
product introductions and enhancements by competitors; the company’s ability
to select and implement appropriate business models, plans and strategies and
to execute on them; fluctuations in the company’s quarterly and annual
operating results; fluctuations in the company’s tax exposure; the impact of
natural disasters on the overall economic condition of North America;
unauthorized use or misappropriation of the company’s intellectual property;
claims by third parties that the company’s software infringes their
intellectual property; the risks inherent in international operations, such as
the impact of the laws, regulations, rules and pronouncements of foreign
jurisdictions and their interpretation by foreign courts, tribunals,
regulatory and similar bodies; the company’s ability to identify, pursue and
complete acquisitions with desired business results; and the existence of
regulatory barriers to integration; as well as the risk factors discussed in
the company’s most recent Annual Report on Form 10-K and Quarterly Reports on
Form 10-Q, filed with the United States Securities and Exchange Commission
("SEC") and the Canadian Securities Administrators ("CSA"), as well as other
periodic reports filed with the SEC and the CSA. Readers should not place
undue reliance on any such forward-looking statements, which speak only as of
the date they are made. The company disclaims any obligation to publicly
update or revise any such statement to reflect any change in its expectations
or in events, conditions, or circumstances on which any such statements may be
based, or that may affect the likelihood that actual results will differ from
those contained in the forward-looking statements.

About Cognos:
Cognos, the world leader in business intelligence and corporate
performance management, delivers software and services that help companies
drive, monitor and understand corporate performance.

Cognos delivers the next level of competitive advantage — Corporate
Performance Management (CPM) — achieved through the strategic application of
BI on an enterprise scale. Our integrated CPM solution helps customers drive
performance through planning; monitor performance through scorecarding; and
understand performance through business intelligence.

Cognos serves more than 23,000 customers in over 135 countries. Cognos
enterprise business intelligence solutions and services are also available
from more than 3,000 worldwide partners and resellers. For more information,
visit the Cognos Web site at http://www.cognos.com.

Cognos, the Cognos logo and Cognos 8 are trademarks or registered
trademarks of Cognos Incorporated in the United States and/or other countries.
All other names are trademarks or registered trademarks of their respective
companies.

Investor Relations:
John Lawlor
613-738-3503
john.lawlor@cognos.com

Media Contacts:
Sean Reid
Cognos, 613-738-1440
Sean.reid@cognos.com

Kristen Orfanos
LP&P, 781-782-5852
Kristen_Orfanos@lpp.com

SUPPLEMENTARY INFORMATION (unaudited):

FY 2005 FY 2006

Q4 Q1 Q2 Q3 Q4

Total License Revenue
($000s) 129,946 71,146 78,649 75,510 117,942

Year-Over-Year License
Revenue Growth 39% 8% 4% (18)% (9)%

Geographic Distribution:
Total Revenue ($000s)
Americas 141,189 115,516 122,593 122,171 147,560
Europe 94,145 66,461 67,596 72,972 87,474
Asia/Pacific 20,992 18,098 21,853 17,111 18,095
% of Total
Americas 55% 58% 58% 58% 58%
Europe 37% 33% 32% 34% 35%
Asia/Pacific 8% 9% 10% 8% 7%
Year-Over-Year Revenue
Growth - Total
Americas 23% 10% 11% 1% 5%
Europe 26% 21% 17% 5% (7)%
Asia/Pacific 63% 31% 28% (12)% (14)%
Pro Forma Year-Over-Year
Revenue Growth - In
Local Currency
Americas 22% 9% 10% 0% 3%
Europe 19% 17% 17% 14% 4%
Asia/Pacific 61% 26% 22% (10)% (9)%

Orders (License, Support,
Services)
> $1M 18 6 9 7 18
> $200K 208 104 124 115 242
> $ 50K 1,215 668 754 737 1,241

Average Selling Price
(License Orders Only)
($000s)
> $ 50K 207 175 172 157 192

New vs Existing License
Revenue - % of Total
New 37% 32% 31% 29% 27%
Existing 63% 68% 69% 71% 73%

Channel - License Revenue
- % of Total
Direct 77% 68% 74% 72% 77%
Third Party 23% 32% 26% 28% 23%

Other Statistics
Cash, cash equivalents,
and short-term
investments ($000s) 522,900 496,036 501,252 483,259 551,002
Days sales outstanding 67 63 60 66 77
Total employees 3,393 3,408 3,453 3,566 3,574

COGNOS INCORPORATED

CONSOLIDATED STATEMENTS OF INCOME

(US$000s except share amounts, U.S. GAAP)

Three months ended
February 28, Years ended February 28,

2006 2005 2006 2005
(Unaudited)

Revenue
Product license $117,942 $129,946 $343,247 $362,958
Product support 96,988 88,477 371,985 320,451
Services 38,199 37,903 162,268 142,122

Total revenue 253,129 256,326 877,500 825,531

Cost of revenue
Cost of product license 1,934 1,280 6,297 3,025
Cost of product support 9,665 10,048 36,405 32,805
Cost of services 31,548 31,796 129,020 113,302

Total cost of revenue 43,147 43,124 171,722 149,132

Gross margin 209,982 213,202 705,778 676,399

Operating expenses
Selling, general, and
administrative 130,495 122,811 447,080 406,204
Research and
development 30,114 29,244 114,740 105,938
Amortization of
acquisition-related
intangible assets 1,697 1,637 6,655 5,602

Total operating expenses 162,306 153,692 568,475 517,744

Operating income 47,676 59,510 137,303 158,655
Interest and other
income, net 7,544 1,578 17,163 6,571

Income before taxes 55,220 61,088 154,466 165,226
Income tax provision 11,230 6,753 29,664 28,622

Net income $ 43,990 $54,335 $124,802 $136,604

Net income per share
Basic $0.49 $0.60 $1.38 $1.51

Diluted $0.48 $0.58 $1.35 $1.47

Weighted average number
of shares (000s)
Basic 90,015 90,982 90,564 90,517

Diluted 91,421 94,187 92,605 93,238

COGNOS INCORPORATED

CONSOLIDATED BALANCE SHEETS

(US$000s, U.S. GAAP)

February 28, February 28,
2006 2005

Assets
Current assets
Cash and cash equivalents $ 398,634 $ 378,348
Short-term investments 152,368 144,552
Accounts receivable 216,850 189,602
Prepaid expenses and other current assets 31,978 24,373
Deferred tax assets 6,783 3,856

806,613 740,731
Fixed assets, net 75,821 73,566
Intangible assets, net 22,125 27,234
Other assets 6,096 6,378
Goodwill 225,709 221,490

$1,136,364 $1,069,399

Liabilities
Current liabilities
Accounts payable $ 33,975 $ 30,705
Accrued charges 30,799 31,047
Salaries, commissions, and related items 73,229 91,010
Income taxes payable 4,648 21,148
Deferred revenue 246,562 222,585

389,213 396,495
Deferred income taxes 28,171 17,083

417,384 413,578

Commitments and Contingencies

Stockholders’ Equity
Capital stock
Common shares and additional paid-in
capital(2006 - 89,826,706;
2005 - 91,070,967) 279,943 252,561
Treasury shares (2006 - 55,970;
2005 - 46,375) (1,563) (1,199)
Deferred stock-based compensation (501) (277)
Retained earnings 436,614 402,020
Accumulated other comprehensive income 4,487 2,716

718,980 655,821

$1,136,364 $1,069,399

COGNOS INCORPORATED

CONSOLIDATED STATEMENTS OF CASH FLOWS

(US$000s, U.S. GAAP)

Three Months Ended Years Ended
February 28, February 28,
2006 2005 2006 2005

Cash flows from operating
activities (Unaudited)
Net income $ 43,990 $54,335 $124,802 $136,604

Non-cash items
Depreciation and
amortization 7,653 5,724 29,362 26,384
Amortization of
deferred stock-based
compensation 152 220 679 734
Amortization of other
deferred compensation - - - 7
Deferred income taxes 5,891 (5,336) 5,971 (4,364)
Loss on disposal of
fixed assets 166 200 521 413

57,852 55,143 161,335 159,778
Change in non-cash
working capital
Increase in accounts
receivable (58,358) (45,790) (30,245) (23,734)
Increase in prepaid
expenses and other
current assets (10,472) (5,665) (7,563) (665)
Increase (decrease)
in accounts payable 7,963 (2,779) 3,409 (5,900)
Increase (decrease)
in accrued charges 5,012 1,352 (714) (2,891)
Increase (decrease)
in salaries,
commissions, and
related items 16,269 22,682 (16,168) 23,987
Increase (decrease)
in income taxes
payable 3,067 7,446 (15,722) 15,032
Increase in deferred
revenue 71,362 65,251 30,606 32,860

Net cash provided by
operating activities 92,695 97,640 124,938 198,467

Cash flows from investing
activities
Maturity of short-term
investments 117,948 10,145 450,727 330,716
Purchase of short-term
investments (44,187) (29,268) (458,543) (311,689)
Additions to fixed
assets (4,766) (5,545) (21,840) (17,516)
Additions to intangible
assets (468) (206) (1,125) (977)
Decrease (increase) in
other assets 311 (6,378) 426 (6,378)
Acquisition costs, net
of cash and cash
equivalents - (2,181) (4,546) (51,887)

Net cash provided by
(used in) investing
activities 68,838 (33,433) (34,901) (57,731)

Cash flows from financing
activities
Issue of common shares 6,756 15,914 34,324 48,734
Purchase of treasury
shares (713) - (890) (335)
Repurchase of shares (24,144) (14,915) (97,527) (42,735)

Net cash provided by
(used in) financing
activities (18,101) 999 (64,093) 5,664

Effect of exchange rate
changes on cash (1,928) (795) (5,658) 7,118

Net increase in cash and
cash equivalents 141,504 64,411 20,286 153,518
Cash and cash
equivalents,
beginning of period 257,130 313,937 378,348 224,830

Cash and cash
equivalents, end of
period 398,634 378,348 398,634 378,348
Short-term investments,
end of period 152,368 144,552 152,368 144,552

Cash, cash equivalents,
and short-term
investments, end of
period $551,002 $522,900 $551,002 $522,900

SOURCE: Cognos

EDITORS’ ADVISORY:
Copies of previous Cognos press releases and Corporate and product
information are available on the Cognos Web site at
http://www.cognos.com and at PR Newswire’s site at
http://www.prnewswire.com

CONTACT: Investor Relations: John Lawlor
+1-613-738-3503, john.lawlor@cognos.com

Media Contacts: Sean Reid
+1-613-738-1440, Sean.reid@cognos.com

Kristen Orfanos of LP&P
+1-781-782-5852, Kristen_Orfanos@lpp.com

Web site: http://www.cognos.com

(COGN CSN.)