CA's Q3 Boosted by Demand for Software, Services

SAN FRANCISCO (01/26/2000) - Computer Associates International Inc. saw financial results for its third quarter boosted by demand for the company's software and services, especially in the area of facilitating customers' electronic business operations, CA said today.

For the period ended Dec. 31, 1999, the U.S. software vendor reported revenue of $1.8 billion, up 33 percent on $1.4 billion reported in the year-ago quarter, CA said in a statement issued today. The $1.8 billion figure includes a negative impact of some $37 million related to foreign exchange issues.

Net income for the third quarter grew to $424.8 million compared with $354.6 million for the same quarter in 1998, while earnings per share rose 28 percent to 91 cents, CA said.

Revenue from CA's distributed systems operation, which accounted for 49 percent of the company's third-quarter revenue, grew 45 percent to $898 million. "We enjoyed tremendous competitive success in the areas of distributed systems management, Internet security, storage management and DB2/IMS tools," CA President and Chief Operating Officer Sanjay Kumar said in today's statement.

Contributing 43 percent to CA's total revenue, OS/390 revenue rose 19 percent to $776 million. Professional services, an area the company is keen to see grow, saw revenue increase 64 percent to $126 million, the software vendor said.

Turning to performance by region, the bulk of CA's revenue came from North America, where sales totalled $1.2 billion, up 41 percent year on year.

Excluding the negative impact of foreign exchange, CA's international revenue rose 27 percent to $617 million. Without reflecting the currency hit, CA's international revenue for the quarter was $580 million.

Revenue for the nine-month period ending Dec. 31, 1999, was $4.6 billion, up 28 percent on the same period last year. The $4.6 billion figure reflects a negative currency effect of close to $76 million, CA said. Excluding a $646 million research and development charge related to CA's acquisition of Platinum Technology Inc. in June of last year, net income for the nine months was $972.8 million compared to $842.7 million for the first three quarters of the previous financial year, CA said.

In other CA news today, the company this morning in New York announced a tie-up with Linux distributor Red Hat Inc. in which CA will provide four of its software offerings on the Linux operating system. [See "CA, Red Hat Alliance Leads to More Linux Apps," Jan. 26.]CA, in Islandia, New York, can be reached at +1-516-342-5224 or at http://www.cai.com/.

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