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CA Technologies Backs FY12 Outlook; To Buy Watchmouse - Update

IT management software company CA Technologies (CA) on Friday reiterated its financial outlook for fiscal year 2012. Separately, the company said it has agreed to acquire privately-held Watchmouse B.V., a maker of Software as a Service or SaaS-backed tools for monitoring cloud, mobile and traditional web applications.

Ahead of its Investor Day being held in New York City, CA Technologies said it is reaffirming its fiscal year 2012 outlook issued on July 20.

Accordingly, CA Technologies continues to expect total revenue growth for fiscal year 2012 in a range of 6 percent to 8 percent in constant currency. The company also reiterated its outlook for earnings per share growth for the year 5 percent to 9 percent, and adjusted earnings per share growth of 6 percent to 10 percent in constant currency.

Analysts polled by Thomson Reuters expect the company to report earnings of $2.18 per share for the year on revenues of $4.86 billion. Analysts' estimates typically exclude special items.

For the three years beginning fiscal year 2013, CA Technologies forecasts adjusted earnings per share growth in constant currency in low double digits and organic revenue growth in constant currency in mid-single digits.

Richard Beckert, chief financial officer of CA Technologies said, "We will make investments to grow - both organically and through acquisitions - especially in the areas of hybrid cloud management, SaaS and MSPs, while increasing operating efficiency to further invest in growth areas and drive operating margin expansion."

Beckert also said the company is committed to returning cash to shareholders through share repurchases and dividends.

Earlier in the day, CA Technologies said it has agreed to acquire privately-held Watchmouse B.V. Terms of the deal were not disclosed.

The company noted that WatchMouse will bolster CA Technologies CA Application Performance Management or APM solution, giving large enterprise customers flexible options to manage their applications within a single solution set. The WatchMouse solution will be sold as an add-on capability to the full-featured CA APM solution.

According to CA Technologies, WatchMouse will augment the Nimsoft IT Management-as-a-Service strategy by enabling customers to quickly and easily monitor response times for different types of business services - from the cloud to the data center.

CA Technologies noted that with WatchMouse technology, customers of both CA Technologies Service Assurance and Nimsoft will be able to proactively manage the end-user experience, quickly identify and resolve application performance issues and also keep cloud vendors accountable for their service level agreements.

CA Technologies, last week, reported an 11 percent increase in profit for the first quarter, helped by higher subscription and maintenance revenue. The company's net income for the quarter was $241 million or $0.47 per share, up from $217 million or $0.42 per share for the year-ago quarter. Revenue for the quarter rose 9 percent to $1.16 billion from $1.07 billion in the prior-year period.

In Friday's trading, CA is trading at $22.10, down $0.23 or 1.01 percent on a volume of 200 shares.

by RTT Staff Writer

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