CA Technologies Profit Rises, Backs FY14 Outlook

(RTTNews) - Software maker CA Technologies (CA), Wednesday reported an increase in profit for the first quarter, helped mainly by lower expenses and an income tax benefit despite decline in revenues. Both earnings and revenues for the quarter came in ahead of analysts' expectations. The company also reaffirmed its full-year 2014 outlook.

Islandia, New York-based CA Technologies' first-quarter profit rose to $335 million or $0.73 per share from $240 million or $0.51 per share last year.

Adjusted earnings improved to $0.78 per share from $0.63 per share last year. Analysts polled by Thomson Reuters expected earnings of $0.74 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 $1.128 billion from $1.145 billion last year. Analysts estimated revenues of $1.10 billion for the quarter.

Chief Executive Mike Gregoire said, "I am pleased with our performance in the first quarter and the start we made to fiscal year 2014. We did better than expected on the revenue line and were able to capitalize on organizational efficiencies, expense management and a tax benefit to drive earnings growth."

Selling and marketing costs dropped to $281 million from $305 million last year. General and administrative expenses narrowed to $91 million from $110 million last year.

For the quarter, CA Technologies recorded an income tax benefit of $118 million, compared to an income tax expense of $130 million last year.

Moving ahead, the company reaffirmed its financial outlook for the full year 2014. On a constant currency basis, CA Technologies expect earnings to decreases in a range of minus 11 percent to minus 6 percent, adjusted earnings to increases in a range of 16 percent to 20 percent and revenue to decreases in a range of minus 4 percent to minus 2 percent.

At June 30, 2013 exchange rates, the outlook indicates 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 estimate earnings of $2.99 per share on revenues of $4.47 billion for the year.

CA closed Wednesday's regular trade at $29.88, up $0.12 or 0.40%, on a volume of 6.21 million shares on the Nasdaq. The stock further gained $0.04 or 0.13% in after hours.