Earnings rise 35% at Computer Associates, and stock surges

Article Abstract:

Computer Associates International announced strong results for 1st qtr FY 1997, and the news, combined with a strong earnings report from Intel, contributed to the general rebound of technology stocks. For the quarter ending Jun 30, 1996, net income totaled $119.8 million, a 35% increase. Taking recent stock splits into consideration, the figures compare to $88.5 million in net income in the same quarter the previous year. Revenues for the FY 1997 quarter grew from $577 million to $792 million. Computer Associates sells software to mid-size and large firms and has shifted its focus from mainframe software to client/server applications. Sales of the company's midrange programs grew 50% over the prior-year totals, but mainframe sales also continued strong, up 36% from the previous year. The company's results were so dramatic that trading was delayed for a short time after the results were released, and when it resumed, shares rose $6 to close at $46.50 each on Jul 17, 1996.

Securities, Company sales/revenue, Company earnings/profit, Company securities

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For Computer Associates, sales and net rise again

Article Abstract:

Computer Associates International (CA) reported revenues of over $3.5 billion for the fiscal year ending in Mar 1996, making the mainframe software vendor the second-largest independent software firm. For the quarter, which also ended Mar 1996, CA's net income grew to $265 million, up 24.5% from the $213 million made in the same quarter one year earlier. Quarterly revenues totaled $1.1 billion, a 38% increase from $802 million in the previous year. Despite the strong figures, CA's stock fell 6%, or $5.125 to close at $76 per share on May 22, 1996. Analysts attribute the drop, which followed a 15% run-up in the stock's price, to a warning from CA Pres Sanjay Kumar that the 1995 acquisition of Legent would adversely affect earnings. CA is expanding into client/server software, which accounted for roughly 30% of the company's sales. The company's goal is to derive 50% of sales from mainframe and 50% from client/server software.

Company Sales/Revenue, Company Earnings/Profit

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Computer Associates reaches accord with U.S. on Legent

Article Abstract:

Computer Associates International (CA) reaches an agreement with the Justice Dept that allows CA to acquire Legent and keep all but four mainframe utility programs for its own use. CA will pay $1.74 billion to acquire Legent and its 150 software programs. Observers believe that the antitrust division of the Justice Dept had been exerting pressure to get CA to sell off some of the software applications. Under the agreement, CA must license each of the four mainframe utilities to a competitor, and the Justice Dept must approve the the competitor and the terms of the license. The four mainframe management utilities run on the VSE operating system. VSE use has been steadily decreasing for some time, since the biggest maker of mainframes, IBM, has moved its customers to other operating systems. CA states that it is pleased with the deal and is looking for licensees.

Laws, regulations and rules, Mergers, acquisitions and divestments, United States. Department of Justice. Antitrust Division, Government Regulation, Legent Corp., Government Activity, LGNT

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