BMC Reports 2Q Profit, Inks Reseller Pact with IBM Global Services

The company also unveiled a reseller agreement with IBM Global Services.

For the quarter ended Sept. 30, BMC reported earnings of $10.1 million, or 4 cents per share, compared with a loss of $53.3 million, or 22 cents per share, in the same quarter last year.

Revenue for the quarter dropped to $291.2 million, down 1 percent from $295.1 million in the year-ago quarter.

Excluding special items, the systems and data management vendor reported earnings of $19.3 million, or 8 cents per share, beating analysts' earnings estimates by 4 cents.

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Financial analysts expected BMC to report earnings of 4 cents per share on revenue of $295 million, according to First Call/Thompson Financial.

"Overall, the IT spending environment remains challenging. Both North America and European revenues fell short of our internal plans," Bob Beauchamp, president and CEO of BMC, said during a conference call.

Beauchamp said he was disappointed with the performance during the quarter of Patrol, BMC's flagship management software for distributed systems.

Revenue from Patrol dropped during the quarter to $46.3 million, down 22 percent from $59.4 million in the same quarter last year.

Beauchamp Thursday also said that IBM Global Services will resell BMC's full product line but declined to disclose financial expectations from the deal.

IBM Global Services will bundle BMC technology with products from other vendors as part of solution offerings that target particular market requirements, such as management of a Siebel or SAP environment, Beauchamp said.

BMC's pending acquisition of Peregrine Systems' Remedy service management business unit, announced in September, is expected to close next month, he said.

For the third quarter, BMC expects earnings to range from 8 cents to 11 cents per share. The company adjusted its full-year expectations for fiscal 2003, excluding charges, to be in the range of 36 cents to 42 cents per share, compared with previous estimates of 32 cents to 42 cents per share.

Shares of BMC closed down 21 cents at $15.49 Thursday prior to the earnings report.