Computer Associates is having a busy week.
As part of its yearly convention in Las Vegas, the software and services firm rolled out new additions to its product line, closed its books on last year’s finances, and positioned for a $10 million settlement with the Securities & Exchange Commission (SEC).
As part of its earnings announcement for its fiscal fourth quarter and year ending March 31st, CA said it had set aside $10 million as a settlement offer for the SEC, which is conducting a probe of how CA booked revenue in past years. The investigation has led to fraud charges against key executives as well as the removal of CEO Sanjay Kumar.
The offer is just an offer at this point; there was no word from the SEC. But the move was one of many that CA has been taking lately in order to put the accounting mess behind it and new products in front of customers.
During day three of its caworld conference, the Islandia, N.Y., company launched two new add-ons for its eTrust security platform: Managed Vulnerability Service (MVS) and Vulnerability
Manager r8. Both are designed to take the hassle out of manually checking network assets for security vulnerabilities.
The rack-mountable r8 plugs into the network and, according to officials,
offers an automated end-to-end check for all the systems within. It
features automated patching, system configuration and security risk reports
for standards compliance.
For companies that don’t have the
resources to keep on top of vulnerabilities on the network, CA rolled out its services-based MVS, a subscription-based program in which eTrust analysts assess the customer’s network and recommend equipment or software. The program would offer or provide configuration or new policies to institute within the company.
The two are used together — the hardware to find out what’s wrong and the
services component to recommend changes — in an effort to drive down costs
within the enterprise.
“With the number of known vulnerabilities and the sophistication of active
attacks increasing daily, our customers are under tremendous pressure to
keep business-critical applications up and running while keeping costs low,”
Bernhard Stadler, Fujitsu Siemens Computers Unix security senior program
manager, said in a statement.
CA also announced BrightStor, a server recovery and backup application,
support on the Microsoft Storage Server 2003. With it, customers can roll
the Microsoft product into their existing data storage architecture. Also
announced was the beta launch of Wireless Site Management, a software
package for managing and securing 802.11-based, or Wi-Fi, deployments within
an organization.
“It is apparent from our results that CA is continuing to advance its
leadership position in the rapidly expanding management software market,”
said Kenneth Cron, CA’s interim CEO, in a statement. “Despite a number of
distractions during the quarter, our employees have remained focused on
providing the broadest and most innovative software suite in the industry to
meet customers’ demand for infrastructure, security and storage management
capabilities.”
Closing out 2004
Late Tuesday, officials released their fourth quarter
and fiscal year 2004 numbers, showing $850 million in revenues for the quarter and $3.27 billion for the year.
Net income for the third quarter was $89 million, compared to a loss of $106 million for the same, year-ago quarter ending March 31st. For the fiscal year, its net income was $25 million, compared to a net loss of $267 during fiscal 2003.
The figures were in line with its preliminary assessment announced in early May, when CA Controller Doug Robinson announced expected revenues between $845
million and $865 million for the fourth quarter and $3.28 billion for fiscal
year 2004.
In its earnings report, CA also noted a charge of $10 million in the fourth
quarter for an initial offer it made with the SEC “in connection with recent
settlement discussions,” the report stated. No word was mentioned on when
the investigation would be concluded, or the extent of the financial damages
the SEC will assess the company, though officials warned investors it could
be significant. Earlier this week, Cron hinted a
settlement could be reached soon.
Earnings were delayed
by several weeks as Robinson and his team scrambled to revise earnings in fiscal years 2000 and 2001 as a result of the probe, which federal officials have said artificially inflated its earnings results.
An internal audit and restatement led to a $2.2 billion change in the company’s financial books.
CA said it is bullish about 2005 and expects the recent upswing in IT contracts it has signed recently to help the company as it concentrates on the months
remaining. Officials conservatively expect 2005 revenues to modestly
increase from fiscal 2004’s $3.27 billion to somewhere in the range of
$3.5-3.7 billion, and earnings per share in the range of 28 to 33 cents.
