CA, BMC Report Growth But Brace For Slowing Economy

"CA recorded another solid quarter, meeting its objectives in a challenging economic environment," said John Swainson, CA's chief executive officer, in a statement. "Over the past few years, we have taken steps to increase efficiency, improve our cost structure, foster stronger and deeper relationships with our customers, and deliver the industry's most innovative products. These efforts are driving our results."

Additionally, the Islandia, N.Y.-based CA also announced that its board of directors commissioned the buyback of up to $250 million of its common shares, which Swainson said was an indication of the company's "strong cash position, confidence in CA's long-term prospects and our dedication to building shareholder value."

Altogether, revenue for the second quarter totaled $1.107 billion, representing a four percent increase from the $1.067 billion reported last fiscal year, with North American revenue up three percent in the second quarter. Total net income rose significantly to $209 million, up from $137 million second quarter of 2007.

Looking forward, CA execs projected that the company's full-year total revenue growth at about two percent, or about $4.3 billion, in light of currency exchange rates.

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Meanwhile, Houston-based BMC today announced double digit revenue growth across all major geographies during its fiscal 2009 second quarter. The company's revenue increased by 11 percent to $467 million, up from $420.7 million the previous year.

Executives contended that the company's uptick in revenue resulted from a business model influenced by a significant recurring stream of license and maintenance revenue.

"BMC Software had a strong quarter despite the continuing macroeconomic uncertainty," said Bob Beauchamp, BMC's chairman and chief executive officer, in a statement. "Our performance reflects the real and tangible value that customers see in our Business Service Management solutions. These benefits, which were very attractive in a good economic environment, are just as compelling in a difficult one."

However, reflecting downward economic trends, BMC's net earnings decreased to $69.8 million, down from $77.4 million during the same time in the previous year. Execs attribute the decrease as a result of a decline in other non-operating income coupled by an increase in intangible asset amortization from the acquisition of BladeLogic.

BMC also continued its stock repurchasing, spending $100 million to repurchase 3.1 million outstanding shares.

While BMC's third quarter outlook forecast growth, execs said also took into consideration the current weak macroeconomic environment and the credit crisis, which would likely have an impact on IT spending.

Consequently, execs said that they expect total bookings in 2009 to undergo a percentage increase only in the mid single digits, and a total revenue growth in the high single digits in subsequent quarters, while projecting that cash flow operations will be between $600 and $650 million.