HERNDON, Va. — (BUSINESS WIRE) — April 29, 2010 — Deltek, Inc. (Nasdaq: PROJ), the leading provider of enterprise applications software and solutions for project-focused businesses, today announced financial results for its first quarter ended March 31, 2010.

Q1 license revenue was $14.0 million, an increase of 24.7% compared to the first quarter of 2009. Maintenance and support revenue in the first quarter was $32.6 million, up 6.5% from the prior year. Consulting services revenue for Q1 was $17.2 million, compared to $20.1 million in Q1 2009, a decline of 14%. Total revenue for the first quarter of 2010 was $63.8 million, up 2.9% from last year’s first quarter.

Q1 GAAP operating income increased 59% to $9.2 million from $5.8 million in the first quarter of 2009. Q1 GAAP operating income margin was 14.4%, up from 9.4% for Q1 of the prior year. Non-GAAP operating income for the first quarter of 2010 increased 28.2% to $13.8 million, from $10.7 million in 2009. Non-GAAP operating income margin was 21.6% for Q1 2010 and up from 17.3 % in the prior year.

Q1 GAAP net income was $4.2 million, or $0.06 per diluted share, compared to $2.7 million, or $0.06 per diluted share, in the first quarter of 2009. Non-GAAP net income for the first quarter of 2010 was $6.9 million, or $0.11 per diluted share, compared to $5.6 million, or $0.12 per diluted share, in Q1 2009.

Non-GAAP operating income and margin exclude the pre-tax impact of stock-based compensation, expenses associated with the Company's 2005 recapitalization, amortization of acquired intangible assets, and restructuring charges. Non-GAAP net income excludes the same items on a net-of-tax basis.

A reconciliation of GAAP to non-GAAP financial measures is provided in the tables at the end of this press release.

“The significant increase in our Q1 license revenue and operating margins was driven by growth in both our Architecture & Engineering and international markets, the improving level of confidence among our customers, and our continuing focus on our profitability,” said Kevin Parker, Deltek’s president and CEO. “We also saw a significant increase in sales to our existing customers as they expanded their use of Deltek solutions across their organizations, an important indication of customer growth and improving business confidence.”

Sequential Results (Q1 2010 vs. Q4 2009)

Total revenue for the first quarter of 2010 was $63.8 million compared to $70.3 million in Q4 2009. License revenue for Q1 2010 was $14.0 million compared to $19.2 million in the fourth quarter of 2009. Maintenance and support revenue in the first quarter of 2010 was $32.6 million, up from $32.3 million in Q4 2009. Consulting services revenue for Q1 2010 was $17.2 million compared to $18.8 million in Q4 2009.

Q1 GAAP operating income was $9.2 million compared to $14.1 million in the fourth quarter of 2009. GAAP operating income margin was 14.4% for Q1 2010 and 20% for Q4 of 2009. Non-GAAP operating income for the first quarter of 2010 was $13.8 million compared to $18.2 million in the fourth quarter of 2009. Non-GAAP operating income margin was 21.6% for Q1 2010 compared to 25.9% for Q4 2009.

Q1 GAAP net income was $4.2 million, or $0.06 per diluted share, compared to $7.2 million, or $0.11 per diluted share, in the fourth quarter of 2009. Non-GAAP net income for the first quarter of 2010 was $6.9 million, or $0.11 per diluted share, compared to $9.8 million, or $0.15 per diluted share, in Q4 2009.

Non-GAAP operating income and margin exclude the pre-tax impact of stock-based compensation, expenses associated with the Company's 2005 recapitalization, amortization of acquired intangible assets, and restructuring charges. Non-GAAP net income excludes the same items on a net-of-tax basis.

The sequential variances primarily reflect the historic pattern of seasonal fluctuations in the company’s business.

A reconciliation of GAAP to non-GAAP financial measures is provided in the tables at the end of this press release.

Recent Highlights

• Deltek and FedSources entered into a partnership to offer the industry's first opportunity-based teaming centers through Deltek's breakthrough govWin network. These unique teaming centers provide one central location to review the latest content on individual government program opportunities, discover teaming partners, and form the optimal team to win business from government programs. With this partnership, the govWin network now includes a pre-built teaming center specifically targeted to winning business within the massive Eagle II program.
• VSE Corporation, one of the fastest-growing government contractors in the nation, is standardizing on Deltek’s government contracting solutions to power its continued growth. A longtime Costpoint user, VSE has entered into a multi-year agreement to use Deltek software to further enhance business performance and increase customer service. VSE recently deployed Deltek Performance Management (DPM) to offer dashboards for executive and business managers, implemented Deltek Cobra to assist with the execution of a major government contract, and became an enterprise customer of Deltek’s govWin network to find teaming partners and win new business.
• Deltek’s govWin network was successfully launched in January, and by the end of the quarter had achieved a number of important milestones, with more than 10,000 registered users across the entire government contracting market. During the quarter, a number of Deltek Costpoint customers have subscribed to govWin’s Supplier Management Solution to enable them to better manage their supplier networks, and Deltek added its first govWin CRM customers, who will be utilizing Deltek’s SaaS solution to power their business development initiatives.
• The Tatitlek Corporation, an Alaska Native Corporation headquartered in Anchorage, Alaska, selected Deltek’s Costpoint to streamline its processes and power its rapid growth strategy. Tatitlek will utilize Deltek’s market-leading government contracting solutions to automate important functions such as time collection, payroll, and fixed-asset tracking. The company will also leverage Costpoint CRM to improve the efficiency and effectiveness of its business development processes, and Deltek Performance Management to drive business intelligence across the organization. Tatitlek is an important addition to Deltek’s strong customer base of Alaska Native Corporations.
• Altus Group, a leading Canada-based global provider of real estate consulting services, selected Deltek Vision to streamline its entire back and front offices to increase organizational efficiency. Altus Group also purchased Vision Performance Management and will leverage the role-based dashboards in the solution to make important business decisions based on real-time metrics. The deal with Altus Group represents another major win in Canada, further demonstrating Deltek’s continuing momentum in this region.
• After a successful multi-year implementation process, SAIC has completed its company-wide roll-out of Deltek Costpoint across their rapidly growing government contracting business. By replacing their legacy systems with Costpoint, SAIC has standardized on a single scalable platform and delivered significant improvements to their core operational and financial capabilities. Powered by the industry leading functionality and capabilities of Costpoint, SAIC has over 35,000 employees delivering over 40,000 projects around the world.