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CA Reports Solid Q4 and Full-Year Results.

Article Excerpt
Driven by Increased Focus on Systems and Security Management and More Stringent Cost Controls

ISLANDIA, N.Y., May 26 /PRNewswire-FirstCall/ -- Computer Associates International, Inc. , one of the world's largest management software companies, today reported financial results for its fourth quarter and full fiscal year 2005, ended March 31, 2005.

Financial Overview (in millions, except Q4FY05 Q4FY04 Change FY05 FY04 Change share data) Revenue $910 $850 7% $3,536 $3,276 8% Non-GAAP $0.20 $0.18 11% $0.82 $0.61 34% Operating EPS* GAAP EPS from $0.03 $0.05 (40%) $0.02 $(0.06) n/m Continuing Operations * Operating earnings per share is a non-GAAP financial measure, as noted in the discussion of non-GAAP results below. A reconciliation of GAAP income from continuing operations to non-GAAP operating income is included in the tables following this press release.

"In this year of transition, CA continued to report solid financial results while investing to build a strong foundation for growth," said CA President and Chief Executive Officer John Swainson. "We are focusing on our strengths in systems and security management to advance our leadership position in the enterprise and deliver value to our shareholders. We are enthusiastic about our future."

"During fiscal year 2005, we invested in our growth strategies to drive sales and build for the future while still delivering on our promise of modest billings and cash flow growth for the year," said CA Chief Operating Officer Jeff Clarke. "We now must execute and leverage the investments we've made for sustainable, long-term growth. Our cost restructuring plan announced this past fall is saving the Company about $70 million on an annualized basis and our procurement savings program is showing strong results. In the meantime, we're delivering immediate value to our shareholders, doubling the annual cash dividend and increasing the share repurchase program."

New deferred subscription revenue for the fourth quarter increased 84 percent over the prior year period to $1.54 billion, including $50 million from the Company's indirect channel sales. For the fiscal year, new deferred subscription revenue increased 59 percent over the prior year period to $3.65 billion, including $144 million from the Company's indirect channel sales. For the year, CA increased bookings from its indirect channel sales by 19 percent over the prior year period.

For the year, security management bookings nearly doubled over the prior year period, while enterprise systems management bookings increased 42 percent.

CA's total deferred subscription revenue balance as of March 31, 2005 was approximately $5.6 billion, compared with $4.3 billion at the end of fiscal year 2004.

Expenses for the quarter totaled $838 million compared with $807 million in the prior year comparable period. The increase in expenses was primarily associated with control documentation and testing efforts associated with the Company's compliance with the Sarbanes-Oxley Act. For the year, expenses were $3.52 billion compared with $3.33 billion in the prior year. Expenses for fiscal year 2005 included an aggregate of $262 million for one-time costs associated...

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