FONT-SIZE Plus   Neg

Comverse Technology Q4 Profit Falls - Update

Comverse Technology, Inc. (CMVT) reported Tuesday a sharp decline in fourth-quarter profit, reflecting mainly a fall in service revenues and a provision for income taxes compared to a benefit last year.

Comverse Technology is a holding company that conducts business through its subsidiaries, principally its wholly-owned subsidiary Comverse, Inc. and its majority-owned subsidiaries Verint Systems Inc and Starhome B.V.

Comverse subsidiary operating margin declined to 5.5 percent from 7.1 percent in the prior year. Comverse VAS operating margin was 31.1 percent, compared to 46.7 percent a year ago. Comverse BSS operating margin increased to 24 percent from 19.5 percent last year.

Charles Burdick, chairman and chief executive officer of the company said, "Although due to several project deferrals we did not experience expected fourth quarter strength in BSS customer solution order activity, our pipeline remains strong and we expect growth in BSS customer order activity."

In the fourth quarter, net income attributable to the company plunged to $4.48 million or $0.02 per share from $15.43 million or $0.07 per share reported last year.

Adjusted earnings were $0.14 per share, significantly down from $0.57 per share in the prior year.

On average, six analysts polled by Thomson Reuters expected the company to report earnings of $0.16 per share for the quarter. Analysts' estimates typically exclude special items.

The recent quarter recorded an income tax provision of $7.16 million, while the prior year had a tax benefit of $12.23 million.

Total revenue declined to $405.46 million from $430.84 million in the same quarter last year, which also came below analysts' estimate of $427.35 million. Product revenues increased to $177.52 million from $166.98 million a year ago, while Service revenues dropped to $227.93 million from $263.85 million in the preceding year.

"We achieved operating income and positive operating cash flow for the quarter in each of our three subsidiaries, building a solid foundation to support our future success," Burdick added.

CMVT is currently trading at $6.58, down 3.95 percent, on a volume of 1.27 million shares.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Apple Inc. plans to launch a new guide for Apple TV during a product event in California today, according to Recode. While major video partners have signed up to be a part of the new Apple TV guide, Netflix Inc. will reportedly not be participating. Wal-Mart Stores Inc. is gearing up for the upcoming holiday season by deploying an army of Holiday Helpers to help customers get through the checkout process faster during the busy period. The retailer has also increased the amount of products available through its Pickup service, lowered the price on thousand of items, and plans to expand the online assortment in the coming months. German automaker Volkswagen Group (VKW.L, VLKAF.PK, VOW.BE), which has been entangled in diesel car emissions cheating issues, returned to profit in its third quarter, on lower special charges and slightly higher sales.
comments powered by Disqus
Follow RTT