CA Names New CEO, Tops 3Q Estimates
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CA on Thursday named William McCracken as its new chief executive and tiptoed past analysts' estimates in its third fiscal quarter, posting a profit of $233 million, or $0.43 a share, on sales of $1.13 billion.
The $1.13 billion in sales represents an 8 percent improvement from the year-earlier quarter when the company reported identical net income, excluding one-time charges, of $233 million, or $0.43 a share.
CA (NASDAQ: CA) shares trimmed $0.35 a share, or 2 percent, to $22.35 ahead of the earnings report. The stock was unchanged in after-hours trading.
A survey of analysts by Thomson Reuters pegged the Islandia, N.Y.-based company for a profit of $0.42 a share in the quarter.
McCracken replaces John Swainson, who joined the company in 2004 and is widely credited for helping turn the once scandal-ridden firm around and returning it to relevance in the ultra-competitive business software sector.
"We are very pleased with our third quarter performance," McCracken said in a statement. "We achieved robust revenue growth, improved both GAAP and non-GAAP operating margins by a percentage point year-over-year, and reported strong cash flow from operations of $342 million."
Looking ahead, CA reiterated its previous guidance of total sales growth of between 2 percent to 4 percent, or $4.3 billion to $4.4 billion.
It expects to return non-GAAP earnings of between $1.60 a share and $1.71 a share for the year.
The third-quarter results included an additional $10 million boost in sales from its September acquisition of network performance management software developer NetQoS.
Company officials said CA exited the quarter with a backlog of more than $7.9 billion in sales, up 9 percent from the year-ago quarter. Total bookings for the quarter checked in at $1.37 billion, up 10 percent from the year-ago quarter.
CA closed 16 licensing deals worth more than $10 million in the quarter and reported total licensing sales of $514 million, up from $471 million in the third quarter of last year.
McCracken, who previously served as the company's executive chairman, was unanimously elected to the top post by the CA's board of directors. He will also serve as chairman of the board of directors.
CA shares soared to a 52-week high of $24.15 a share in October after bottoming out at $15.13 a share in March.
Eight of the 13 analysts providing coverage of the stock maintain either a "hold" or "neutral" recommendation while the stock is rated a "strong buy" or "buy" by the remaining five analysts.