By Chris Coyle
May 21, 2000

Portal Software (NASDAQ: PRSF), a provider of billing software and customer management for communication services (including the internet), posted an unexpected profit Thursday night of $0.02 a share for the first quarter of 2001.

For the first quarter of 2001, the company reported revenues of $50.6 million, up 234% from the $15.2 million in revenue reported the same quarter last year. Net income was $3.1 million, or $0.02 a share, versus a net loss of $5.5 million, or a $0.04 per share loss, in the first quarter of 2000.

These earnings beat estimates from the First Call Corp., which predicted that Portal Software would report a loss of a penny a share.

Portal Software's first quarter earnings increased 675% from the $400,000 the company reported in net incomein the fourth quarter of 2000.

Impressive Growth
The company is very happy with their results for the quarter.

John Little, the founder and CEO of the company said, "Performance in the first quarter demonstrates that our business strategy and company fundamentals are solid and are driving the ability to achieve sustained growth and profitability. Expansion of Portal's position in our core markets coupled with further progress in emerging markets continued to propel rapid growth of our customer base worldwide as evidenced by the closing of our 200th customer, Sprint Canada.''

CFO Jack Acosta was also pleased with the results, commenting on the 47 new customers who signed on with the company in the first quarter.

The company has many large companies as customers, including Qwest Communications (NYSE: Q), US WEST (NYSE:USW), France Telecom (NYSE: FTE), and Inktomi (NASDAQ: INKT) just to name a few.

Portal Software is also creating alliances with key companies, including Microsoft (NASDAQ: MSFT), Cisco (NASDAQ: CSCO), and Nokia (NYSE: NOK).

Portal Software is expanding into new markets, as well. During the quarter, they announced the entry into two new markets: the Internet Business Services (IBS) and Application Service Provider (ASP) markets. The company already has over 20 customers in these new businesses.

It has no doubt been a good quarter for the company. The company is growing rapidly and more importantly, is profitable. Year-end earning estimates are expected to be in at $0.01 per share, while next year, they are expected to make $0.14 per share.

The market took very kindly to the news, pushing the stock up 8 1/8 to 47 1/8. Still, Portal Software is well off its highs of the year (which is $86 a share).

Anyone searching for a strong growth stock may want to take a closer look at Portal Software. If they can continue to produce quarters like this one, there future looks pretty bright.

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