CA Technologies Q2 Profit Up 8%, Results Beat View; Lifts 2014 Outlook

(RTTNews) - Software maker CA Technologies (CA) on Thursday reported an 8 percent increase in profit for the second quarter from last year, reflecting lower expenses that helped offset a decline in revenue. Both earnings and revenue for the quarter beat analysts' expectations. Looking ahead, the company raised its financial outlook for fiscal 2014.

Mike Gregoire, chief executive officer of CA Technologies said, "We over performed on both the top line and the bottom line, enabling us to increase our full year guidance for revenue and GAAP and non-GAAP earnings per share. This is clearly a beginning, but we still have work to do to get the aggregate portfolio growing."

Islandia, New York-based CA Technologies' second-quarter net income rose to $240 million or $0.53 per share from $222 million or $0.48 per share last year.

Adjusted net income for the quarter was $390 million or $0.86 per share, compared to $272 million or $0.59 per share in the year-ago period. On average, analysts polled by Thomson Reuters expected earnings of $0.73 per share for the quarter. Analysts' estimates typically exclude special items.

CA Technologies, which competes with rivals such as BMC Software and Hewlett-Packard, said revenues for the quarter declined 1 percent to $1.14 billion from $1.15 billion in the same period last year. Analysts had a consensus revenue estimate of $1.10 billion for the quarter.

North America revenue for the quarter was flat with the prior-year period at $731 million, and represented 64 percent of total revenues. International revenue declined 3 percent to $409 million and represented 36 percent of total revenues.

Operating expenses before interest and income taxes were $781 million, down 4 percent from the same period last year.

The company's total bookings for the quarter rose 5 percent from the previous-year quarter to $877 million. The increase in bookings was primarily due to higher Mainframe renewals, offset by a decrease in Mainframe and Enterprise Solutions new product sales and Services engagements.

Total revenue backlog at the end of the quarter was $7.24 billion, down 3 percent from last year.

Looking ahead to fiscal year 2014, CA Technologies now forecasts earnings of $1.92 to $1.98 per share, adjusted earnings of $2.96 to $3.03 per share, and revenues of $4.47 billion to $4.52 billion. Earlier, the company expected earnings of $1.81 to $1.91 per share, adjusted earnings of $2.90 to $3.00 per share, and revenues of $4.39 billion to $4.48 billion.

Analysts currently expect the company to report earnings of $2.97 per share for the year on revenues of $4.46 billion.

CA closed Thursday's regular trading at $30.39, up $0.10 or 0.33 percent on a volume of 3.78 million shares. The stock further gained $0.61 or 2.01 percent to $31.00 in after hours.