CSC meets profit expectations; revenue falls short

IT services provider Computer Sciences Corp. (CSC) on Wednesday met analysts' earnings expectations but fell slightly short on revenue for the first quarter of its 2003 fiscal year, which ended June 28.

CSC posted net income of US$79 million, or $0.46 per share, meeting the consensus forecast from analysts polled by Thomson Financial/First Call and posting a substantial increase over net income of $47.7 million, or $0.28 per share, in 2002's first fiscal quarter.

Revenue came in at $2.76 billion, below consensus expectations of $2.85 billion from the analyst poll but up 2 percent over 2002's first fiscal quarter.

Revenue derived from U.S. federal government sales grew 18 percent and made up 29 percent of the quarter's total revenue, CSC said in a statement. The company's U.S. federal government clients include the Department of Defense, the Internal Revenue Service and the Immigration and Naturalization Service.

Revenue from commercial IT services accounted for the rest of the company's quarterly revenue. In this segment, global outsourcing sales were strong, but global sales of consulting and systems integration services suffered due to a slowdown in demand, El Segundo, California-based CSC said.

The company expects revenue to grow in the "low single digits" in the second quarter, compared with the same quarter of last year, officials said during a conference call.

The company's stock closed Wednesday at $37, down 2.63 percent, before the quarter's results were released. The stock's 52-week high is $53.47.

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