Novell earnings meet expectations

Besieged Novell Inc. announced improved quarterly earnings Thursday, in line with analysts who had expected the company to post earnings of one cent per share.

On revenue of US$245 million, Novell's books will show earnings of one cent per share before a one-time accounting adjustment for the quarter, which resulted in a two-cent-per-share loss.

These results compare to revenue of $316 million and diluted earnings per share of $0.13 in the same period a year ago.

Novell said much of the company's troubles could be attributed to its transition of focus to Net Services.

However, in transitioning to Net Services, the company signed major deals with an unnamed European government for Novell Directory Services eDirectory that would manage up to 35 million users. During the quarter, the company also signed business with Freddie Mac, SPX, Towers Perrin and OeNB, the national bank of Austria.

In addition, the company partnered with PricewaterhouseCoopers and e-business provider Atos Origin to provide products and services to the healthcare and e-business community.

In the first fiscal quarter of 2001, revenue declined 10 percent from the fourth quarter of fiscal 2000. Net Management Services revenue characterized by sales of the NetWare operating system, GroupWise and ZENworks management products declined 10 percent overall. Net Directory revenue also declined 10 percent.

Revenues from the Net Content Group, recently spun off as Volera, were lower than the company expected, due to a change the company made to recognize royalty and service revenue from Excelerator caching OEMs one month in arrears. Service education and consulting revenue was also down.

Novell says that historically its first fiscal-quarter revenue is down, but it is followed by sequential increases over the next year.

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