Avocent Profit Jumps

Avocent ( AVCT), a network equipment technology provider, said its second-quarter earnings increased 22.4%, boosted by increased sales and improved margins.

The company earned $13.58 million, or 28 cents a share, in the quarter, compared with $11.1 million, or 22 cents a share, a year ago. Adjusted for intangible amortization and stock based expenses, earnings were 38 cents a share in the most recent quarter. Analysts were expecting earnings of 38 cents a share in the most recent quarter.

Second-quarter revenue rose 31.8% from a year ago period to $118.01 million as against analysts' expectation of $115.65 million.

Second-quarter gross profit rose 35.2% from a year-ago period to $71.41 million and gross margin increased 152 basis points to 60.5%. Operating profit rose more than double from a year-ago period to $17.2 million and operating margin increased 588 basis points to 14.6%.

The company said its branded sales, which accounted for 59.9% of the total second-quarter sales, increased 54.3% to $70.64 million in the quarter. OEM sales, which accounted for 40.1% of the total second-quarter sales, increased 8.3% to $47.36 million in the quarter.

During the second quarter the company incurred $2.3 million in severance and integration expenses related to integrating Cyclades.

"The strong results in the second quarter reflected renewed strength across our core product lines," said the company. "We are particularly pleased that the rapid integration of the Cyclades acquisition, which closed at the end of the first quarter 2006, enabled the serial management products to make the expected contribution to our revenue. We also are pleased with the increased sales of our digital KVM products and embedded software solutions and the strong growth in Asian sales."

This story was created through a joint venture between TheStreet.com and IRIS.

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