CA Inc.'s (CA) fiscal third-quarter profit fell 22% as the
business-software maker posted a lower operating margin, although
revenue growth and adjusted earnings topped Wall Street's
expectations.
The company raised its view for the year, projecting adjusted
earnings of $1.88 to $1.98 a share on a 4% to 5% increase in
revenue. In October, CA projected a profit of $1.85 to $1.97 on a
3% to 5% increase in revenue.
Results for CA, a maker of software for mainframe and other
corporate computers, were resilient during the downturn as the
company cut costs to match revenue.
For the quarter ended Dec. 31, CA reported earnings of $200
million, or 39 cents a share, down from $257 million, or 49 cents a
share, a year earlier. Excluding restructuring and other impacts,
earnings from continuing operations rose to 51 cents from 46 cents
as revenue improved 3.8% to $1.17 billion.
Analysts polled by Thomson Reuters expected earnings of 49 cents
on revenue of $1.16 billion.
Operating margin narrowed to 29% from 31.2%.
Revenue in North America increased 7.2%, while it fell 0.8%
internationally.
Bookings decreased 6.3%, and fell 5% on a constant-currency
basis, primarily due to a decrease in license and maintenance
renewal bookings.
Separately, CA announced it has acquired privately-held Torokina
Networks, a deal that allows the company to offer 'one-stop
shopping' for communications service providers to help them
optimize services and network availability.
The deal will combine Torokina's technology with CA's existing
service. Torokina, founded in 2005, has offices in Australia and
Singapore, with affiliate offices located in four cities outside
those markets. Some of its clients are large users of network
technologies in the Asia-Pacific region.
CA didn't disclose financial details about the transaction.
Shares of CA fell 1.4% to $25 in after-hours trading.
-By John Kell and Jenny Roth, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com