Information technology services provider Computer Sciences Corp. (CSC) reported Thursday a loss for the fourth quarter compared to a profit last year, hurt by a significant restructuring charge and falling sales.
However, quarterly revenues topped analysts' expectations.
Meanwhile, the company delayed issuing guidance for the full-year 2013 to a later date as it is still evaluating the impact of its turnaround initiatives.
The company's turnaround involves "remediation plans for under-performing contracts, new leadership, revised compensation plans which reward business performance, implementing a more efficient operating model with updated lines of accountability, restructuring and cost re-balancing activities."
Mike Lawrie took over as the new president and CEO of the company, with effect from March 19, succeeding Michael Laphen, who retired from these positions on February 7, 2012. The company has also appointed former Gannett Co., Inc. (GCI) CFO Paul Saleh as its vice president and CFO, effective May 23.
"We consider these results to be very poor as the Company is executing well below an acceptable level for CSC and its investors. There are many reasons for our under-performance - primarily NHS write-offs and challenges managing our cost structure, aligning our global organization, and in executing some of our MSS contracts," Lawrie said in a statement.
The company also added that it is experiencing some market headwinds in the Federal business and in Europe.
The Falls Church, Virginia-based company reported a net loss of $158 million or $1.02 per share for the fourth quarter, compared to net income of $171 million or $1.09 per share in the prior-year quarter.
Loss per share from continuing operations for the quarter was $1.02, compared to earnings of $1.01. The results for the latest quarter includes a restructuring charge of $140 million or $0.88 per share.
On average, nine analysts polled by Thomson Reuters expected earnings per share of $0.20 for the fourth quarter. Analysts' estimates typically exclude one-time items.
Revenues for the quarter declined 2.1 percent or 1.5 percent in constant currency, to $4.11 billion from $4.20 billion in the same quarter last year, but topped twelve Wall Street analysts' consensus estimate of $4.10 billion by a whisker.
Revenues declined year-over-year in North American public sector, or NPS by 6.6 percent, and managed services sector revenues decreased 2.3 percent or 1.3 percent in constant currency, while business solutions & services revenues grew 5.1 percent or 5.7% in constant currency.
New business awards for the quarter totaled $6.3 billion, up 40 percent from the year-ago quarter. Managed services sector reported $4.0 billion of the new business.
For fiscal 2012, the company's revenues decreased 1.0 percent or 2.9 percent in constant currency, to $15.88 billion from last year. Loss per share from continuing operations was $27.38, compared to earnings per share $4.51 last year. Street was looking for full-year 2012 earnings of $3.58 per share on annual revenues of $15.97 billion.
In Thursday's regular trading session, CSC is currently trading at $26.26, down $0.16 or 0.61% on a volume of 35,920 shares. In the past 52-week period, the stock has been trading in a range of $22.80 to $44.92.
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