ISLANDIA, N.Y., Jan. 24, 2012 /PRNewswire/ -- CA Technologies
(NASDAQ: CA) today reported financial results for its third quarter
of fiscal year 2012, ended Dec. 31,
2011.
- Revenue $1.263 Billion,
Up 10 Percent in Constant Currency and as Reported
- GAAP EPS $0.54, Up 39 Percent
in Constant Currency and 42 Percent as Reported
- Non-GAAP EPS $0.65, Up 28
Percent in Constant Currency and 30 Percent as Reported
- Single License Payment Contributes 3 Percentage Points to
Revenue Growth and $0.05 to GAAP and
Non-GAAP EPS Growth
- Cash Flow from Continuing Operations $396 Million, Down 19 Percent in Constant
Currency and 20 Percent as Reported
- Raises Full Year Outlook for GAAP and non-GAAP EPS and
Adjusts Revenue Guidance to High End of Range; Maintains Cash Flow
from Continuing Operations Outlook
- Enhances Capital Allocation Program, Targeting Return of
$2.5 Billion To Shareholders Through
Fiscal Year 2014
FINANCIAL OVERVIEW
Note: All financial results have been adjusted to
reflect discontinued operations.
|
|
|
|
Third
Quarter FY12 vs. FY11
|
|
|
(in millions, except share
data)
|
|
FY12
|
FY11
|
%
Change
|
%
Change
CC**
|
|
|
Revenue
|
|
$1,263
|
$1,144
|
10%
|
10%
|
|
|
GAAP Income from continuing
operations
|
|
$263
|
$196
|
34%
|
24%
|
|
|
Non-GAAP Income from continuing
operations*
|
|
$319
|
$256
|
25%
|
18%
|
|
|
GAAP Diluted EPS from continuing
operations
|
|
$0.54
|
$0.38
|
42%
|
39%
|
|
|
Non-GAAP Diluted EPS from
continuing operations*
|
|
$0.65
|
$0.50
|
30%
|
28%
|
|
|
Cash Flow from continuing
operations
|
|
$396
|
$492
|
(20%)
|
(19%)
|
|
|
|
|
|
|
|
|
|
|
|
* Non-GAAP income and earnings per share are non-GAAP financial
measures, as noted in the discussion of non-GAAP results below. A
reconciliation of non-GAAP financial measures to their comparable
GAAP financial measures is included in the tables following this
news release.
**CC: Constant Currency
EXECUTIVE COMMENTARY
"We had a good quarter on many measures and continued to make
solid progress against our long-term goals," said Bill McCracken, chief executive officer, CA
Technologies. "However, we are not done. We remain focused on
continuing to execute on our strategy and making further
operational enhancements including driving new product sales and
increasing sales productivity.
"The $2.5 billion enhanced capital
allocation program announced today is the culmination of
significant work evaluating ways to optimize our balance sheet,
while maintaining the financial flexibility needed to build our
business and enhance our competitive positioning," McCracken
continued. "We believe we're on a path to achieve a balanced
approach to return even more cash to shareholders, while still
investing in our future."
REVENUE AND BOOKINGS
The Company received a final license payment in the third
quarter of $39 million under a
license agreement entered into in connection with a 2009 litigation
settlement with a software company. The payment reflects the
final amount owed, which was scheduled to be repaid in fiscal years
2013 and 2014. The company made the final payment at its
discretion, without any discount or concession by CA
Technologies.
During the third quarter, the Company saw demand for its
virtualization and service automation products, security solutions
including products from Arcot Systems, Interactive TKO (ITKO)
products, mainframe solutions and professional services.
About 8 percentage points of revenue growth in constant
currency and as reported were driven by organic products, while
about 2 percentage points in constant currency and as reported came
from acquired products. About 63 percent of the Company's
revenue came from North America,
while 37 percent came from international operations.
Revenue year-over-year:
- Total revenue was $1.263 billion,
up 10 percent in constant currency and as reported. The single
license payment contributed 3 percentage points of revenue growth,
all in North America.
- Total revenue backlog was $8.084
billion, up 2 percent in constant currency and as reported.
The current portion of revenue backlog was $3.576 billion, up 2 percent in constant currency
and 1 percent as reported.
- North America revenue was
$791 million, up 15 percent in
constant currency and as reported.
- International revenue was $472
million, up 3 percent in constant currency and as
reported.
Bookings year-over-year:
- Total bookings in the third quarter were $1.284 billion, up 2 percent in constant currency
and 1 percent as reported. The single license payment
contributed 3 percentage points of growth to bookings, all in
North America.
- The Company renewed a total of 12 license agreements with
incremental contract values in excess of $10
million each, for an aggregate contract value of
$452 million. During the third
quarter of fiscal year 2011, the Company renewed a total of 15
license agreements with incremental contract values in excess of
$10 million each, for an aggregate
contract value of $456 million.
- The weighted average duration of subscription and maintenance
bookings for the quarter was 3.53 years, compared with 3.20 years
for the same period in fiscal year 2011.
- North America bookings were
$766 million, up 1 percent in
constant currency and as reported.
- International bookings were $518
million, up 4 percent in constant currency and 2 percent as
reported.
EXPENSES AND MARGIN
Year-over-year GAAP results:
- Operating expenses, before interest and income taxes, were
$850 million, up 5 percent in
constant currency and as reported.
- Operating income, before interest and income taxes, was
$413 million, up 22 percent in
constant currency and up 24 percent as reported.
- Operating margin was 33 percent, up 4 percentage points from
the prior year period.
Year-over-year non-GAAP results, which exclude purchased
software and other intangibles amortization, pre-fiscal year 2010
restructuring costs, and certain other gains and losses (including
recoveries and certain costs associated with derivative litigation
matters and share-based compensation expense), and which include
gains and losses on hedges that mature within the quarter, but
which exclude gains and losses on hedges that do not mature within
the quarter:
- Operating expenses, before interest and income taxes, were
$788 million, up 4 percent in
constant currency and as reported.
- Operating income, before interest and income taxes, was
$475 million, up 21 percent in
constant currency and 23 percent as reported.
- Operating margin was 38 percent, up 4 percentage points from
the prior year period.
Both GAAP and non-GAAP operating expense increases were
primarily driven by costs associated with acquisitions and expenses
resulting from increased Services engagements, and product
development and enhancement costs.
For the third quarter of fiscal year 2012, the Company's
effective GAAP tax rate was 34.9 percent, compared with 39.1
percent in the prior year. The Company's effective non-GAAP
tax rate was 31.5 percent, compared with 31.7 percent in the prior
year.
GAAP and non-GAAP EPS were favorably affected by about
$0.05 per share by the single license
payment. In addition, GAAP and non-GAAP EPS were positively
affected by currency and a reduction in share count. The single
license payment also had a positive impact of about 2 percentage
points on both GAAP and non-GAAP margin.
SEGMENT INFORMATION
Beginning in the first quarter of fiscal year 2012, CA
Technologies began reporting segment results in three areas:
Mainframe Solutions, Enterprise Solutions and Services.
- Mainframe Solutions revenue was $682
million, up 9 percent in constant currency and as reported.
The single license payment contributed 6 percent points of growth
to Mainframe Solutions revenue. Operating expense was $277 million and operating profit was
$405 million. Operating margin
was 59 percent, up from 54 percent a year ago.
- Enterprise Solutions revenue was $478
million, up 11 percent in constant currency and 12 percent
as reported. Operating expense was $419 million and operating profit was
$59 million. Operating margin
was 12 percent, up from 9 percent a year ago.
- Services revenue was $103
million, up 16 percent in constant currency and 17 percent
as reported. Operating expense was $92
million and operating profit was $11
million. Operating margin was 11 percent, up from 10
percent a year ago.
CASH FLOW FROM CONTINUING OPERATIONS
Cash flow from continuing operations in the third quarter was
$396 million, including the
$39 million single license payment,
compared with $492 million in the
prior year. Cash flow from operations reflected a decline in
cash collections, including a reduction in single installment
payments. The Company reiterated its fiscal year 2012 outlook
for cash flow from operations.
CAPITAL STRUCTURE
- Cash, cash equivalents and marketable securities at
Dec. 31, 2011 were $2.539 billion.
- With $1.309 billion in total debt
outstanding and approximately $120
million in notional pooling, the Company's net cash, cash
equivalents and marketable securities position was $1.110 billion.
- In the third quarter, the Company repurchased approximately 9.6
million shares of stock, for $200
million and distributed $25
million in dividends.
- The Company's outstanding share count at Dec. 31, 2011 was 480 million.
CAPITAL ALLOCATION PROGRAM
The Company announced that its Board of Directors has approved a
capital allocation program that targets the return of up to
$2.5 billion to CA Technologies
shareholders through the fiscal year ending March 31, 2014.
The Company's capital allocation program plans to return
approximately 80 percent of expected cumulative free cash flow to
shareholders through fiscal 2014. This includes a planned
increase in the annual dividend from $0.20 to $1.00 per
common share and the authorization to repurchase up to $1.5 billion in CA Technologies common stock,
including $232 million remaining
under the Company's current share repurchase authorization.
Approximately $500 million of
the planned repurchase is expected to be an accelerated share
repurchase pursuant to an agreement executed in the Company's
fiscal fourth quarter ending March 31,
2012. For more information, see separate news release
announced today.
BUSINESS HIGHLIGHTS
During the third quarter:
- The Company held CA World, a user conference that had about
5,000 attendees including 135 sponsors and nearly 350 exhibitors,
and announced key initiatives and 12 solutions centered on Business
Service Innovation – a customer value proposition that helps
support customers as they transition from simply managing IT to
delivering critical business services.
- Infraserve, an Australian provider of
Infrastructure-as-a-Service (IaaS) solutions, announced it is
offering a new Platform as a Service (PaaS) solution powered by the
CA AppLogic® turnkey cloud computing platform. ViaWest, one of the
largest privately owned data center and managed services providers
in North America, also announced
it is using CA AppLogic and CA Process Automation as the backbone
of its new Xen-based KINECTed™ Cloud – Innovator service.
- The Company was named one of the top two market share leaders
in the worldwide cloud systems management software market by IDC, a
leading provider of global IT research and advice.
- CA Technologies announced CA Access Control for Virtual
Environments, a new solution that extends its identity and access
management (IAM) security expertise, and complements and protects
VMware® virtual environments.
- The Company was ranked ninth out of 500 in Newsweek's
2011 Green Rankings. Newsweek ranks the 500 largest
publicly traded U.S. companies on their environmental footprint,
management and disclosure.
OUTLOOK FOR FISCAL YEAR 2012
The Company updated its outlook for fiscal year 2012. The
following guidance represents "forward-looking statements" (as
defined below). Updated guidance includes the impact of the
single license payment, which was not included in previous
guidance.
The Company expects the following:
- Total revenue growth of 6 percent in constant currency,
compared with the previous outlook of 5 percent to 6 percent.
At Dec. 31, 2011 exchange
rates, this translates to reported revenue of about $4.8 billion.
- GAAP diluted earnings per share growth raised to a range of 11
percent to 13 percent in constant currency, compared with the
previous outlook of 6 percent to 9 percent. At Dec. 31, 2011 exchange rates, this translates to
reported GAAP diluted earnings per share of $1.86 to $1.90.
- Non-GAAP diluted earnings per share growth raised to a range of
11 percent to 13 percent in constant currency, compared with the
previous outlook of 7 percent to 10 percent. At Dec. 31, 2011 exchange rates, this translates to
reported non-GAAP diluted earnings per share of $2.21 to $2.25.
- Cash flow from operations growth continues in a range of 3
percent to 5 percent in constant currency. At Dec. 31, 2011 exchange rates, this translates to
reported cash flow from operations of $1.44
billion to $1.47 billion.
The Company expects a full-year GAAP operating margin of 29
percent and non-GAAP operating margin of 34 percent. The
Company also expects a full-year GAAP and non-GAAP tax rate in a
range of 31 to 32 percent. The Company anticipates 463
million shares outstanding at fiscal year 2012 year-end and
weighted average diluted shares outstanding of 486 million for the
fiscal year.
Webcast
This news release and the accompanying tables should be read in
conjunction with additional content that is available on the
Company's website, including a supplemental financial package, as
well as a webcast that the Company will host at 5 p.m. ET today to discuss its unaudited third
quarter results. The webcast will be archived on the website.
Individuals can access the webcast, as well as this press release
and supplemental financial information, at http://ca.com/invest or
listen to the call at 1-877-561-2748. The international
participant number is 1-720-545-0044.
(Logo: http://photos.prnewswire.com/prnh/20100516/NY05617LOGO
)
About CA Technologies
CA Technologies (NASDAQ: CA) is an IT management software and
solutions company with expertise across all IT environments – from
mainframe and distributed, to virtual and cloud. CA
Technologies manages and secures IT environments and enables
customers to deliver more flexible IT services. CA
Technologies innovative products and services provide the insight
and control essential for IT organizations to power business
agility. The majority of the Global Fortune 500 relies on CA
Technologies to manage evolving IT ecosystems. For additional
information, visit CA Technologies at www.ca.com.
Follow CA Technologies
- Twitter
- Social Media Page
- Press Releases
- Podcasts
Non-GAAP Financial Measures
This news release, the accompanying tables and the additional
content that is available on the Company's website, including a
supplemental financial package, includes certain financial measures
that exclude the impact of certain items and therefore have not
been calculated in accordance with U.S. generally accepted
accounting principles (GAAP). Non-GAAP metrics for operating
expenses, operating income, operating margin, income from
operations and diluted earnings per share exclude the following
items: non-cash amortization of purchased software and other
intangibles, share-based compensation, pre-fiscal year 2010
restructuring and certain other gains and losses, which includes
recoveries and certain costs associated with derivative litigation
matters and includes the gains and losses since inception of hedges
that mature within the quarter, but exclude gains and losses of
hedges that do not mature within the quarter. Prior to fiscal
year 2011, non-GAAP income also excludes the interest on
convertible bonds. The effective tax rate on GAAP and
non-GAAP income from operations is the Company's provision for
income taxes expressed as a percentage of pre-tax GAAP and non-GAAP
income from operations, respectively. Such tax rates are
determined based on an estimated effective full year tax rate, with
the effective tax rate for GAAP generally including the impact of
discrete items in the period such items arise and the effective tax
rate for non-GAAP income generally allocating the impact of
discrete items pro rata to the fiscal year's remaining reporting
periods. Adjusted cash flow from operations excludes
restructuring and other payments. Free cash flow excludes
purchases of property, equipment and capitalized software
development costs. We present constant currency information to
provide a framework for assessing how our underlying businesses
performed excluding the effect of foreign currency rate
fluctuations. To present this information, current and
comparative prior period results for entities reporting in
currencies other than US dollars are converted into US dollars at
the exchange rate in effect on March 31,
2011, which was the last day of our prior fiscal year.
Constant currency excludes the impacts from the Company's
hedging program. The constant currency calculation for
annualized subscription and maintenance bookings is calculated by
dividing the subscription and maintenance bookings in constant
currency by the weighted average subscription and maintenance
duration in years. These non-GAAP financial measures may be
different from non-GAAP financial measures used by other companies.
Non-GAAP financial measures should not be considered as a
substitute for, or superior to, measures of financial performance
prepared in accordance with GAAP. By excluding these items,
non-GAAP financial measures facilitate management's internal
comparisons to the Company's historical operating results and cash
flows, to competitors' operating results and cash flows, and to
estimates made by securities analysts. Management uses these
non-GAAP financial measures internally to evaluate its performance
and they are key variables in determining management incentive
compensation. The Company believes these non-GAAP financial
measures are useful to investors in allowing for greater
transparency of supplemental information used by management in its
financial and operational decision-making. In addition, the
Company has historically reported similar non-GAAP financial
measures to its investors and believes that the inclusion of
comparative numbers provides consistency in its financial
reporting. Investors are encouraged to review the
reconciliation of the non-GAAP financial measures used in this news
release to their most directly comparable GAAP financial measures,
which are attached to this news release.
Cautionary Statement Regarding Forward-Looking Statements
The declaration and payment of future dividends is subject to
the determination of the Company's Board of Directors, in its sole
discretion, after considering various factors, including the
Company's financial condition, historical and forecast operating
results, and available cash flow, as well as any applicable laws
and contractual covenants and any other relevant factors. The
Company's practice regarding payment of dividends may be modified
at any time and from time to time.
Repurchases under the Company's stock repurchase program are
expected to be made with cash on hand and may be made from time to
time, subject to market conditions and other factors, in the open
market, through solicited or unsolicited privately negotiated
transactions or otherwise. The program, which is authorized through
fiscal year 2014, does not obligate the Company to acquire any
particular amount of common stock, and it may be modified or
suspended at any time at the Company's discretion.
Certain statements in this communication (such as statements
containing the words "believes," "plans," "anticipates," "expects,"
"estimates," "targets" and similar expressions) constitute
"forward-looking statements" that are based upon the beliefs of,
and assumptions made by, the Company's management, as well as
information currently available to management. These
forward-looking statements reflect the Company's current views with
respect to future events and are subject to certain risks,
uncertainties, and assumptions. A number of important factors
could cause actual results or events to differ materially from
those indicated by such forward-looking statements, including: the
ability to achieve success in the Company's strategy by, among
other things, increasing sales in new and emerging enterprises and
markets, enabling the sales force to sell new products, improving
the Company's brand in the marketplace and ensuring the Company's
set of cloud computing, Software-as-a-Service and other new
offerings address the needs of a rapidly changing market, while not
adversely affecting the demand for the Company's traditional
products or its profitability; global economic factors or political
events beyond the Company's control; general economic conditions
and credit constraints, or unfavorable economic conditions in a
particular region, industry or business sector; failure to expand
partner programs; the ability to adequately manage and evolve
financial reporting and managerial systems and processes;
acquisition opportunities that may or may not arise; the ability to
integrate acquired companies and products into existing businesses;
competition in product and service offerings and pricing; the
ability to retain and attract qualified key personnel; the ability
to adapt to rapid technological and market changes; the ability of
the Company's products to remain compatible with ever-changing
operating environments; access to software licensed from third
parties; use of software from open source code sources; discovery
of errors in the Company's software and potential product liability
claims; significant amounts of debt and possible future credit
rating changes; the failure to protect the Company's intellectual
property rights and source code; fluctuations in the number, terms
and duration of our license agreements as well as the timing of
orders from customers and channel partners; reliance upon large
transactions with customers; risks associated with sales to
government customers; breaches of the Company's software products
and the Company's and customers' data centers and IT environments;
third-party claims of intellectual property infringement or royalty
payments; fluctuations in foreign currencies; failure to
effectively execute the Company's workforce reductions; successful
outsourcing of various functions to third parties; potential tax
liabilities; and other factors described more fully in the
Company's filings with the Securities and Exchange
Commission. Should one or more of these risks or
uncertainties occur, or should our assumptions prove incorrect,
actual results may vary materially from those described herein as
believed, planned, anticipated, expected, estimated or targeted.
The Company assumes no obligation to update the information
in this communication, except as otherwise required by law. Readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date hereof.
Copyright © 2012 CA, Inc. All Rights Reserved. One CA Plaza,
Islandia, N.Y. 11749. All other trademarks, trade names,
service marks, and logos referenced herein belong to their
respective companies.
Contacts:
|
Dan Kaferle
|
Kelsey Doherty
|
|
|
Public Relations
|
Investor Relations
|
|
|
(631) 342-2111
|
(212) 415-6844
|
|
|
daniel.kaferle@ca.com
|
kelsey.doherty@ca.com
|
|
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|
Table
1
|
|
CA
Technologies
|
|
Condensed
Consolidated Statements of Operations
|
|
(unaudited)
|
|
(in
millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
Revenue
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
Subscription and maintenance
revenue
|
$1,006
|
|
$ 974
|
|
$3,035
|
|
$2,852
|
|
|
Professional services
|
103
|
|
88
|
|
289
|
|
245
|
|
|
Software fees and
other
|
154
|
|
82
|
|
302
|
|
204
|
|
|
Total revenue
|
1,263
|
|
1,144
|
|
3,626
|
|
3,301
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
Costs of licensing and
maintenance
|
69
|
|
74
|
|
207
|
|
207
|
|
|
Cost of professional
services
|
91
|
|
77
|
|
270
|
|
223
|
|
|
Amortization of capitalized
software costs
|
59
|
|
52
|
|
164
|
|
144
|
|
|
Selling and marketing
|
342
|
|
341
|
|
1,038
|
|
931
|
|
|
General and
administrative
|
113
|
|
114
|
|
331
|
|
344
|
|
|
Product development and
enhancements
|
126
|
|
110
|
|
384
|
|
363
|
|
|
Depreciation and amortization of
other intangible assets
|
44
|
|
47
|
|
134
|
|
136
|
|
|
Other expenses (gains),
net
|
6
|
|
(3)
|
|
10
|
|
(2)
|
|
|
Total expenses before interest
and income taxes
|
850
|
|
812
|
|
2,538
|
|
2,346
|
|
|
Income from continuing
operations before interest and income taxes
|
413
|
|
332
|
|
1,088
|
|
955
|
|
|
Interest expense, net
|
9
|
|
10
|
|
24
|
|
35
|
|
|
Income from continuing
operations before income taxes
|
404
|
|
322
|
|
1,064
|
|
920
|
|
|
Income tax expense
|
141
|
|
126
|
|
337
|
|
284
|
|
|
Income from continuing
operations
|
263
|
|
196
|
|
727
|
|
636
|
|
|
Income from discontinued
operations, net of income taxes
|
-
|
|
4
|
|
13
|
|
3
|
|
|
Net income
|
$ 263
|
|
$ 200
|
|
$ 740
|
|
$ 639
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income per
share
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations
|
$ 0.54
|
|
$0.38
|
|
$ 1.46
|
|
$ 1.24
|
|
|
Income from discontinued
operations
|
-
|
|
0.01
|
|
0.03
|
|
-
|
|
|
Net income
|
$ 0.54
|
|
$0.39
|
|
$ 1.49
|
|
$ 1.24
|
|
|
Basic weighted average shares
used in computation
|
483
|
|
505
|
|
492
|
|
507
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per
share
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations
|
$ 0.54
|
|
$0.38
|
|
$ 1.46
|
|
$ 1.24
|
|
|
Income from discontinued
operations
|
-
|
|
0.01
|
|
0.02
|
|
-
|
|
|
Net income
|
$ 0.54
|
|
$0.39
|
|
$ 1.48
|
|
$ 1.24
|
|
|
Diluted weighted average shares
used in computation
|
484
|
|
506
|
|
493
|
|
508
|
|
|
|
|
|
|
|
|
|
|
|
|
Prior year results have been
adjusted to reflect the discontinued operations associated with the
sale of the Information Governance business and the Internet
Security business.
|
|
|
|
|
|
|
|
|
|
|
Table
2
|
|
CA
Technologies
|
|
Condensed
Consolidated Balance Sheets
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
December
31,
|
|
March
31,
|
|
|
|
2011
|
|
2011
|
|
|
|
(unaudited)
|
|
|
|
|
Cash and cash
equivalents
|
$
2,358
|
|
$ 3,049
|
|
|
Marketable securities -
current
|
102
|
|
75
|
|
|
Trade accounts receivable, net
|
840
|
|
849
|
|
|
Deferred income taxes -
current
|
158
|
|
246
|
|
|
Other current assets
|
146
|
|
152
|
|
|
Total current
assets
|
3,604
|
|
4,371
|
|
|
|
|
|
|
|
|
Marketable securities -
noncurrent
|
79
|
|
104
|
|
|
Property and equipment,
net
|
387
|
|
437
|
|
|
Goodwill
|
5,856
|
|
5,688
|
|
|
Capitalized software and other
intangible assets, net
|
1,426
|
|
1,284
|
|
|
Deferred income taxes -
noncurrent
|
175
|
|
284
|
|
|
Other noncurrent assets,
net
|
264
|
|
246
|
|
|
Total assets
|
$
11,791
|
|
$ 12,414
|
|
|
|
|
|
|
|
|
Current portion of long-term
debt and loans payable
|
$
18
|
|
$
269
|
|
|
Deferred revenue (billed or
collected) - current
|
2,270
|
|
2,600
|
|
|
Deferred income taxes -
current
|
44
|
|
68
|
|
|
Other current
liabilities
|
969
|
|
987
|
|
|
Total current
liabilities
|
3,301
|
|
3,924
|
|
|
|
|
|
|
|
|
Long-term debt, net of current
portion
|
1,291
|
|
1,282
|
|
|
Deferred income taxes -
noncurrent
|
62
|
|
64
|
|
|
Deferred revenue (billed or
collected) - noncurrent
|
854
|
|
969
|
|
|
Other noncurrent
liabilities
|
555
|
|
555
|
|
|
Total liabilities
|
6,063
|
|
6,794
|
|
|
|
|
|
|
|
|
Common stock
|
59
|
|
59
|
|
|
Additional paid-in
capital
|
3,593
|
|
3,615
|
|
|
Retained earnings
|
4,771
|
|
4,106
|
|
|
Accumulated other comprehensive
loss
|
(131)
|
|
(65)
|
|
|
Treasury stock
|
(2,564)
|
|
(2,095)
|
|
|
Total stockholders’
equity
|
5,728
|
|
5,620
|
|
|
Total liabilities and
stockholders’ equity
|
$
11,791
|
|
$ 12,414
|
|
|
|
|
|
|
Table
3
|
|
CA
Technologies
|
|
Condensed
Consolidated Statements of Cash Flows
|
|
(unaudited)
|
|
(in
millions)
|
|
|
|
Three Months
Ended
|
|
|
|
December
31,
|
|
|
|
2011
|
|
2010
|
|
|
Operating activities from
continuing operations:
|
|
|
|
|
|
Net
income
|
$ 263
|
|
$ 200
|
|
|
(Income) loss from discontinued operations
|
-
|
|
(4)
|
|
|
Income from continuing operations
|
263
|
|
196
|
|
|
Adjustments to reconcile income from continuing operations to
net cash provided
|
|
|
|
|
|
by operating
activities:
|
|
|
|
|
|
Depreciation and
amortization
|
103
|
|
99
|
|
|
Provision for deferred
income taxes
|
(45)
|
|
-
|
|
|
Provision for bad
debts
|
(3)
|
|
-
|
|
|
Share-based compensation
expense
|
20
|
|
21
|
|
|
Asset impairments and
other non-cash items
|
6
|
|
1
|
|
|
Foreign currency
transaction (gains) losses
|
(3)
|
|
3
|
|
|
Changes in other operating assets and liabilities, net of
effect of acquisitions:
|
|
|
|
|
|
Increase in trade accounts
receivable, net
|
(243)
|
|
(168)
|
|
|
Increase in deferred
revenue
|
94
|
|
209
|
|
|
Increase in taxes payable,
net
|
182
|
|
142
|
|
|
Decrease in accounts
payable, accrued expenses and other
|
(44)
|
|
(20)
|
|
|
Increase in accrued
salaries, wages and commissions
|
26
|
|
12
|
|
|
Changes in other operating
assets and liabilities
|
40
|
|
(3)
|
|
|
Net cash provided by operating
activities - continuing operations
|
396
|
|
492
|
|
|
Investing activities from
continuing operations:
|
|
|
|
|
|
Acquisitions of businesses, net of cash acquired, and purchased
software
|
(4)
|
|
(224)
|
|
|
Purchases of property and equipment
|
(13)
|
|
(26)
|
|
|
Cash
proceeds from divestiture of assets
|
-
|
|
3
|
|
|
Capitalized software development costs
|
(41)
|
|
(43)
|
|
|
Investment in marketable securities, net
|
(2)
|
|
(168)
|
|
|
Other investing activities
|
-
|
|
(1)
|
|
|
Net cash used in investing
activities - continuing operations
|
(60)
|
|
(459)
|
|
|
Financing activities from
continuing operations:
|
|
|
|
|
|
Dividends paid
|
(25)
|
|
(20)
|
|
|
Purchases of common stock
|
(200)
|
|
(33)
|
|
|
Debt
borrowings (repayments)
|
58
|
|
(2)
|
|
|
Exercise of common stock options and other
|
1
|
|
3
|
|
|
Net cash used in financing
activities - continuing operations
|
(166)
|
|
(52)
|
|
|
Net change in cash and cash
equivalents before effect of exchange rate changes
on
cash - continuing
operations
|
170
|
|
(19)
|
|
|
Effect of exchange rate changes
on cash
|
(11)
|
|
8
|
|
|
Cash (used) provided by
operating activities - discontinued operations
|
(4)
|
|
4
|
|
|
Net effect of discontinued
operations on cash and cash equivalents
|
(4)
|
|
4
|
|
|
Increase (decrease) in cash and
cash equivalents
|
155
|
|
(7)
|
|
|
Cash and cash equivalents at
beginning of period
|
2,203
|
|
2,525
|
|
|
Cash and cash equivalents at end
of period
|
$2,358
|
|
$2,518
|
|
|
|
|
|
|
|
|
Prior year results have been
adjusted to reflect the discontinued operations associated with the
sale of the Information Governance business and the Internet
Security business.
|
|
|
|
|
|
|
Table
4
|
|
CA
Technologies
|
|
Operating
Segments
|
|
(unaudited)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2011
|
|
Nine Months
Ended December 31, 2011
|
|
|
|
Mainframe
Solutions (1)
|
|
Enterprise
Solutions (1)
|
|
Services
(1)
|
|
Total
|
|
Mainframe
Solutions (1)
|
|
Enterprise
Solutions (1)
|
|
Services
(1)
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue (2)
|
$
682
|
|
$
478
|
|
$
103
|
|
$1,263
|
|
$ 1,983
|
|
$
1,354
|
|
$
289
|
|
$ 3,626
|
|
|
Expenses (3)
|
277
|
|
419
|
|
92
|
|
788
|
|
861
|
|
1,223
|
|
272
|
|
2,356
|
|
|
Segment profit
|
$
405
|
|
$
59
|
|
$
11
|
|
$ 475
|
|
$ 1,122
|
|
$
131
|
|
$
17
|
|
$ 1,270
|
|
|
Segment operating
margin
|
59%
|
|
12%
|
|
11%
|
|
38%
|
|
57%
|
|
10%
|
|
6%
|
|
35%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment profit
|
|
|
|
|
|
|
$ 475
|
|
|
|
|
|
|
|
$ 1,270
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased software
amortization
|
|
|
|
27
|
|
|
|
|
|
|
|
76
|
|
|
Other intangibles
amortization
|
|
|
|
16
|
|
|
|
|
|
|
|
50
|
|
|
Share-based
compensation expense
|
|
|
|
20
|
|
|
|
|
|
|
|
61
|
|
|
Other unallocated
operating gains, net (4)
|
|
|
|
(1)
|
|
|
|
|
|
|
|
(5)
|
|
|
Interest expense,
net
|
|
|
|
9
|
|
|
|
|
|
|
|
24
|
|
|
Income from continuing
operations before income taxes
|
|
|
$ 404
|
|
|
|
|
|
|
|
$ 1,064
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31, 2010
|
|
Nine Months
Ended December 31, 2010
|
|
|
|
Mainframe
Solutions (1)
|
|
Enterprise
Solutions (1)
|
|
Services
(1)
|
|
Total
|
|
Mainframe
Solutions (1)
|
|
Enterprise
Solutions (1)
|
|
Services
(1)
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue (2)
|
$
628
|
|
$
428
|
|
$
88
|
|
$1,144
|
|
$ 1,858
|
|
$
1,198
|
|
$
245
|
|
$ 3,301
|
|
|
Expenses (3)
|
289
|
|
391
|
|
79
|
|
759
|
|
834
|
|
1,104
|
|
230
|
|
2,168
|
|
|
Segment profit
|
$
339
|
|
$
37
|
|
$
9
|
|
$ 385
|
|
$ 1,024
|
|
$
94
|
|
$
15
|
|
$ 1,133
|
|
|
Segment operating
margin
|
54%
|
|
9%
|
|
10%
|
|
34%
|
|
55%
|
|
8%
|
|
6%
|
|
34%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment profit
|
|
|
|
|
|
|
$ 385
|
|
|
|
|
|
|
|
$ 1,133
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased software
amortization
|
|
|
|
23
|
|
|
|
|
|
|
|
67
|
|
|
Other intangibles
amortization
|
|
|
|
18
|
|
|
|
|
|
|
|
51
|
|
|
Share-based
compensation expense
|
|
|
|
21
|
|
|
|
|
|
|
|
61
|
|
|
Other unallocated
operating gains, net (4)
|
|
|
|
(9)
|
|
|
|
|
|
|
|
(1)
|
|
|
Interest expense,
net
|
|
|
|
10
|
|
|
|
|
|
|
|
35
|
|
|
Income from continuing
operations before income taxes
|
|
|
$ 322
|
|
|
|
|
|
|
|
$ 920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) - Mainframe Solutions – Our
Mainframe Solutions segment addresses the mainframe market and is
focused on making significant investments in order to be innovative
in key management disciplines across our broad portfolio of
products. Ongoing development is guided by customer needs,
our cross-enterprise management philosophy and our Mainframe 2.0
strategy, which offers management capabilities designed to appeal
to the next generation of mainframe staff while also offering
productivity improvements to today’s mainframe experts. Our
mainframe business assists customers by addressing three major
challenges: lowering costs, providing high service levels by
sustaining critical workforce skills and increasing agility to help
deliver on business goals.
- Enterprise Solutions – Our
Enterprise Solutions segment includes products that operate on
non-mainframe platforms, such as service assurance, security
(identity and access management), project and portfolio management,
service management, virtualization and service automation, SaaS,
and cloud offerings. Our offerings help customers address
their regulatory compliance demands, privacy needs, and internal
security policies. Enterprise Solutions also focuses on delivering
growth to the Company in the form of new customer acquisitions and
revenue, while leveraging non-traditional routes-to-market and
delivery models.
- Services – Our Services
segment offers implementation, consulting, education and training
services to customers, which is intended to promote a seamless
customer experience and to increase the value that customers
realize from our solutions.
|
|
|
|
(2) We regularly enter
into a single arrangement with a customer that includes Mainframe
Solutions segment software products, Enterprise Solutions segment
software products and Services. The amount of contract
revenue assigned to segments is generally based on the manner in
which the proposal is made to the customer. The software
product revenue is assigned to the Mainframe Solutions and
Enterprise Solutions segments based on either: (1) a list price
allocation method (which allocates a discount in the total contract
price to the individual products in proportion to the list price of
the product); (2) allocations included within internal contract
approval documents; or (3) the value for individual software
products as stated in the customer contract. The price for
the implementation, consulting, education and training services is
separately stated in the contract and these amounts of contract
revenue are assigned to the Services segment. The contract
value assigned to each segment is then recognized in a manner
consistent with the revenue recognition policies we apply to the
customer contract for purposes of preparing the Condensed
Consolidated Financial Statements.
|
|
|
|
(3) Segment expenses
include costs that are controllable by segment managers (i.e.,
direct costs) and, in the case of the Mainframe Solutions and
Enterprise Solutions segments, an allocation of shared and indirect
costs (i.e., allocated costs). Segment-specific direct costs
include a portion of selling and marketing costs, licensing and
maintenance costs, product development costs, general and
administrative costs and amortization of the cost of internally
developed software. Allocated segment costs primarily include
indirect selling and marketing costs and general and administrative
costs that are not directly attributable to a specific segment.
The basis for allocating shared and indirect costs between
the Mainframe Solutions and Enterprise Solutions segments is
dependent on the nature of the cost being allocated and is either
in proportion to segment revenues or in proportion to the related
direct cost category. Expenses for the Services segment
consist only of direct costs and there are no allocated or indirect
costs for the Services segment.
|
|
|
|
(4) Other unallocated
operating gains, net consists of restructuring costs associated
with the Company's Fiscal 2007 Plan, foreign exchange derivative
(gains) losses, and other miscellaneous costs.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
5
|
|
CA
Technologies
|
|
Constant
Currency Summary
|
|
(unaudited)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
|
|
2011
|
|
2010
|
|
%
Increase
(Decrease)
in $ US
|
|
%
Increase
(Decrease)
in Constant
Currency (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Bookings
|
$ 1,284
|
|
$ 1,266
|
|
1%
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
North America
|
$ 791
|
|
$ 686
|
|
15%
|
|
15%
|
|
|
International
|
472
|
|
458
|
|
3%
|
|
3%
|
|
|
Total revenue
|
$ 1,263
|
|
$ 1,144
|
|
10%
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
Subscription and
maintenance
|
$ 1,006
|
|
$ 974
|
|
3%
|
|
3%
|
|
|
Professional
services
|
103
|
|
88
|
|
17%
|
|
16%
|
|
|
Software fees and
other
|
154
|
|
82
|
|
88%
|
|
87%
|
|
|
Total revenue
|
$ 1,263
|
|
$ 1,144
|
|
10%
|
|
10%
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Revenue:
|
|
|
|
|
|
|
|
|
|
Mainframe
Solutions
|
$ 682
|
|
$ 628
|
|
9%
|
|
9%
|
|
|
Enterprise
Solutions
|
478
|
|
428
|
|
12%
|
|
11%
|
|
|
Services
|
103
|
|
88
|
|
17%
|
|
16%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses before interest
and income taxes:
|
|
|
|
|
|
|
|
|
|
Total Non-GAAP
(2)
|
$ 788
|
|
$ 759
|
|
4%
|
|
4%
|
|
|
Total GAAP
|
$ 850
|
|
$ 812
|
|
5%
|
|
5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended December 31,
|
|
|
|
2011
|
|
2010
|
|
%
Increase
(Decrease)
in $ US
|
|
%
Increase
(Decrease)
in Constant
Currency (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Bookings
|
$ 3,121
|
|
$ 2,999
|
|
4%
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
North America
|
$ 2,242
|
|
$ 2,005
|
|
12%
|
|
12%
|
|
|
International
|
1,384
|
|
1,296
|
|
7%
|
|
0%
|
|
|
Total revenue
|
$ 3,626
|
|
$ 3,301
|
|
10%
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
Subscription and
maintenance
|
$ 3,035
|
|
$ 2,852
|
|
6%
|
|
3%
|
|
|
Professional
services
|
289
|
|
245
|
|
18%
|
|
14%
|
|
|
Software fees and
other
|
302
|
|
204
|
|
48%
|
|
46%
|
|
|
Total revenue
|
$ 3,626
|
|
$ 3,301
|
|
10%
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Revenue:
|
|
|
|
|
|
|
|
|
|
Mainframe
Solutions
|
$ 1,983
|
|
$ 1,858
|
|
7%
|
|
4%
|
|
|
Enterprise
Solutions
|
1,354
|
|
1,198
|
|
13%
|
|
10%
|
|
|
Services
|
289
|
|
245
|
|
18%
|
|
14%
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses before interest
and income taxes:
|
|
|
|
|
|
|
|
|
|
Total Non-GAAP
(2)
|
$ 2,356
|
|
$ 2,168
|
|
9%
|
|
6%
|
|
|
Total GAAP
|
$ 2,538
|
|
$ 2,346
|
|
8%
|
|
6%
|
|
|
|
|
|
|
|
|
|
|
|
(1) Constant currency
information is presented to provide a framework for assessing how
our underlying businesses performed excluding the effect of foreign
currency rate fluctuations. To present this information,
current and comparative prior period results for entities reporting
in currencies other than US dollars are converted into US dollars
at the exchange rate in effect on March 31, 2011, which was the
last day of our prior fiscal year. Constant currency excludes
the impacts from the Company's hedging program.
|
|
|
|
(2) Refer to Table 7 for a
reconciliation of total expenses before interest and income taxes
to total non-GAAP operating expenses.
|
|
|
|
Prior year results have
been adjusted to reflect the discontinued operations associated
with the sale of the Information Governance business and the
Internet Security business.
|
|
Certain non-material
differences may arise versus actual from impact of rounding.
|
|
|
|
|
|
|
|
|
|
|
Table
6
|
|
CA
Technologies
|
|
Reconciliation of Select GAAP
Measures to Non-GAAP Measures
|
|
(unaudited)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December 31,
2011
|
|
December 31,
2010
|
|
December 31,
2011
|
|
December 31,
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
|
$
263
|
|
$
200
|
|
$
740
|
|
$
639
|
|
|
GAAP income from discontinued
operations, net of income taxes
|
-
|
|
4
|
|
13
|
|
3
|
|
|
GAAP income from continuing
operations
|
263
|
|
196
|
|
727
|
|
636
|
|
|
GAAP income tax
expense
|
141
|
|
126
|
|
337
|
|
284
|
|
|
Interest expense, net
|
9
|
|
10
|
|
24
|
|
35
|
|
|
GAAP income from continuing
operations before interest and income taxes
|
413
|
|
332
|
|
1,088
|
|
955
|
|
|
GAAP operating margin (% of
revenue) (1)
|
33%
|
|
29%
|
|
30%
|
|
29%
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments to
expenses:
|
|
|
|
|
|
|
|
|
|
Costs of licensing and
maintenance(2)
|
-
|
|
1
|
|
2
|
|
3
|
|
|
Cost of professional
services(2)
|
1
|
|
1
|
|
3
|
|
3
|
|
|
Amortization of
capitalized software costs(3)
|
27
|
|
23
|
|
76
|
|
67
|
|
|
Selling and
marketing(2)
|
9
|
|
8
|
|
25
|
|
23
|
|
|
General and
administrative(2)
|
5
|
|
7
|
|
17
|
|
17
|
|
|
Product development and
enhancements(2)
|
5
|
|
4
|
|
14
|
|
15
|
|
|
Depreciation and
amortization of other intangible assets(4)
|
16
|
|
18
|
|
50
|
|
51
|
|
|
Other (gains) losses, net
(5)
|
-
|
|
-
|
|
(5)
|
|
7
|
|
|
Restructuring and other
(6)
|
(1)
|
|
(9)
|
|
-
|
|
(8)
|
|
|
Total Non-GAAP adjustment to
operating expenses
|
62
|
|
53
|
|
182
|
|
178
|
|
|
Non-GAAP income from continuing
operations before interest and income taxes
|
475
|
|
385
|
|
1,270
|
|
1,133
|
|
|
Non-GAAP operating margin (% of
revenue) (7)
|
38%
|
|
34%
|
|
35%
|
|
34%
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense, net
|
9
|
|
10
|
|
24
|
|
35
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income tax
expense
|
141
|
|
126
|
|
337
|
|
284
|
|
|
Non-GAAP adjustment to income
tax expense(8)
|
6
|
|
(7)
|
|
56
|
|
77
|
|
|
Non-GAAP income tax
expense
|
147
|
|
119
|
|
393
|
|
361
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP income from continuing
operations
|
$
319
|
|
$
256
|
|
$
853
|
|
$
737
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) GAAP operating margin
is calculated by dividing GAAP income from continuing operations
before interest and income taxes by total revenue (refer to Table 1
for total revenue).
|
|
|
|
(2) Non-GAAP adjustment
consists of share-based compensation.
|
|
|
|
(3) Non-GAAP adjustment
consists of purchased software amortization.
|
|
|
|
(4) Non-GAAP adjustment
consists of other intangibles amortization.
|
|
|
|
(5) Consists of gains and
losses since inception of hedges that mature within the quarter,
but exclude gains and losses of hedges that do not mature within
the quarter.
|
|
|
|
(6) Non-GAAP adjustment
consists of Fiscal 2007 Restructuring Plan expense adjustments.
|
|
|
|
(7) Non-GAAP operating
margin is calculated by dividing non-GAAP income from continuing
operations before interest and income taxes by total revenue (refer
to Table 1 for total revenue).
|
|
|
|
(8) The effective tax rate
on GAAP and non-GAAP income from continuing operations is the
Company's provision for income taxes expressed as a percentage of
GAAP and non-GAAP income from continuing operations before income
taxes, respectively. Such tax rates are determined based on
an estimated effective full year tax rate after the adjustments for
the impacts of certain discrete items (such as changes in tax
rates, reconciliations of tax returns to tax provisions and
resolutions of tax contingencies).
|
|
|
|
Refer to the discussion of
non-GAAP financial measures included in the accompanying press
release for additional information.
|
|
|
|
Prior year results have
been adjusted to reflect the discontinued operations associated
with the sale of the Information Governance business and the
Internet Security business.
|
|
|
|
Certain non-material
differences may arise versus actual from impact of rounding.
|
|
|
|
|
|
|
|
|
|
|
Table
7
|
|
CA
Technologies
|
|
Reconciliation of GAAP to
Non-GAAP
|
|
Operating
Expenses and Diluted Earnings per Share
|
|
(unaudited)
|
|
(in
millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
Operating Expenses
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses before interest
and income taxes
|
$ 850
|
|
$ 812
|
|
$2,538
|
|
$2,346
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating
adjustments:
|
|
|
|
|
|
|
|
|
|
Purchased software
amortization
|
27
|
|
23
|
|
76
|
|
67
|
|
|
Other intangibles
amortization
|
16
|
|
18
|
|
50
|
|
51
|
|
|
Share-based
compensation
|
20
|
|
21
|
|
61
|
|
61
|
|
|
Restructuring and other
(1)
|
(1)
|
|
(9)
|
|
-
|
|
(8)
|
|
|
Hedging losses (gains),
net (2)
|
-
|
|
-
|
|
(5)
|
|
7
|
|
|
Total non-GAAP operating
adjustments
|
62
|
|
53
|
|
182
|
|
178
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-GAAP operating
expenses
|
$ 788
|
|
$ 759
|
|
$2,356
|
|
$2,168
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
|
Diluted EPS from Continuing
Operations
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP diluted EPS from continuing
operations
|
$0.54
|
|
$0.38
|
|
$ 1.46
|
|
$ 1.24
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments, net of
taxes
|
|
|
|
|
|
|
|
|
|
Purchased software and
other intangibles amortization
|
0.06
|
|
0.05
|
|
0.18
|
|
0.15
|
|
|
Share-based
compensation
|
0.03
|
|
0.03
|
|
0.08
|
|
0.09
|
|
|
Restructuring and other
(1)
|
-
|
|
(0.01)
|
|
-
|
|
(0.01)
|
|
|
Hedging losses (gains),
net (2)
|
-
|
|
-
|
|
-
|
|
0.01
|
|
|
Non-GAAP effective tax
rate adjustments (3)
|
0.02
|
|
0.05
|
|
(0.01)
|
|
(0.04)
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted EPS from
continuing operations
|
$0.65
|
|
$0.50
|
|
$ 1.71
|
|
$ 1.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Non-GAAP adjustment
consists of Fiscal 2007 Restructuring Plan expense adjustments.
|
|
|
|
(2) Consists of gains and
losses since inception of hedges that mature within the quarter,
but exclude gains and losses of hedges that do not mature within
the quarter.
|
|
|
|
(3) The effective tax rate
on non-GAAP income from continuing operations is the Company's
provision for income taxes expressed as a percentage of non-GAAP
income from continuing operations before income taxes. Such
tax rates are determined based on an estimated effective full year
tax rate after the adjustments for the impacts of certain discrete
items (such as changes in tax rates, reconciliations of tax returns
to tax provisions and resolutions of tax contingencies).
|
|
|
|
Refer to the discussion of
non-GAAP financial measures included in the accompanying press
release for additional information.
|
|
|
|
Prior year results have
been adjusted to reflect the discontinued operations associated
with the sale of the Information Governance business and the
Internet Security business.
|
|
|
|
Certain non-material
differences may arise versus actual from impact of rounding.
|
|
|
|
|
|
|
|
|
|
|
Table
8
|
|
CA
Technologies
|
|
Effective
Tax Rate Reconciliation
|
|
GAAP and
Non-GAAP
|
|
(unaudited)
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December 31,
2011
|
|
December 31,
2011
|
|
|
|
GAAP
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations before interest and income taxes (1)
|
$ 413
|
|
$
475
|
|
$1,088
|
|
$ 1,270
|
|
|
Interest expense, net
|
9
|
|
9
|
|
24
|
|
24
|
|
|
Income from continuing
operations before income taxes
|
$ 404
|
|
$
466
|
|
$1,064
|
|
$ 1,246
|
|
|
|
|
|
|
|
|
|
|
|
|
Statutory tax rate
|
35%
|
|
35%
|
|
35%
|
|
35%
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax at statutory rate
|
141
|
|
163
|
|
372
|
|
436
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for discrete and
permanent items (2)
|
-
|
|
(16)
|
|
(35)
|
|
(43)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total tax expense
|
$ 141
|
|
$
147
|
|
$ 337
|
|
$
393
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax rate
(3)
|
34.9%
|
|
31.5%
|
|
31.7%
|
|
31.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
|
December 31,
2010
|
|
December 31,
2010
|
|
|
|
GAAP
|
|
Non-GAAP
|
|
GAAP
|
|
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from continuing
operations before interest and income taxes (1)
|
$ 332
|
|
$
385
|
|
$ 955
|
|
$ 1,133
|
|
|
Interest expense, net
|
10
|
|
10
|
|
35
|
|
35
|
|
|
Income from continuing
operations before income taxes
|
$ 322
|
|
$
375
|
|
$ 920
|
|
$ 1,098
|
|
|
|
|
|
|
|
|
|
|
|
|
Statutory tax rate
|
35%
|
|
35%
|
|
35%
|
|
35%
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax at statutory rate
|
113
|
|
131
|
|
322
|
|
384
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for discrete and
permanent items (2)
|
13
|
|
(12)
|
|
(38)
|
|
(23)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total tax expense
|
$ 126
|
|
$
119
|
|
$ 284
|
|
$
361
|
|
|
|
|
|
|
|
|
|
|
|
|
Effective tax rate
(3)
|
39.1%
|
|
31.7%
|
|
30.9%
|
|
32.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Refer to Table 6 for a
reconciliation of income from continuing operations before interest
and income taxes on a GAAP basis to income from continuing
operations before interest and income taxes on a non-GAAP basis.
|
|
|
|
(2) The effective tax rate
for GAAP generally includes the impact of discrete and permanent
items in the period such items arise, whereas the effective tax
rate for non-GAAP generally allocates the impact of such items pro
rata to the fiscal year's remaining reporting periods.
|
|
|
|
(3) The effective tax rate
on GAAP and non-GAAP income from continuing operations is the
Company's provision for income taxes expressed as a percentage of
GAAP and non-GAAP income from continuing operations before income
taxes, respectively. Such tax rates are determined based on
an estimated effective full year tax rate after the adjustments for
the impacts of certain discrete items (such as changes in tax
rates, reconciliations of tax returns to tax provisions and
resolutions of tax contingencies).
|
|
|
|
Refer to the discussion of
non-GAAP financial measures included in the accompanying press
release for additional information.
|
|
|
|
Certain non-material
differences may arise versus actual from impact of rounding.
|
|
|
|
|
|
|
|
|
|
|
Table
9
|
|
CA
Technologies
|
|
Reconciliation of Projected GAAP
Earnings per Share to
|
|
Projected
Non-GAAP Earnings per Share
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
Fiscal Year
Ending
|
|
|
Projected Diluted EPS from
Continuing Operations
|
March 31,
2012
|
|
|
|
|
|
|
|
|
Projected GAAP diluted EPS from
continuing operations range
|
$
1.86
|
to
|
$
1.90
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments, net of
taxes:
|
|
|
|
|
|
Purchased software
and other intangibles amortization
|
0.23
|
|
0.23
|
|
|
Share-based
compensation
|
0.12
|
|
0.12
|
|
|
|
|
|
|
|
|
Non-GAAP projected diluted EPS
from continuing operations range
|
$
2.21
|
to
|
$
2.25
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Refer to the discussion of
non-GAAP financial measures included in the accompanying press
release for additional information.
|
|
|
|
|
|
|
Table
10
|
|
CA
Technologies
|
|
Reconciliation of Projected GAAP
Operating Margin to
|
|
Projected
Non-GAAP Operating Margin
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
Fiscal Year
Ending
|
|
|
|
|
March 31,
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
Projected GAAP operating margin
range
|
|
29%
|
|
|
|
|
|
|
|
Non-GAAP adjustments, net of
taxes:
|
|
|
|
|
Purchased software
and other intangibles amortization
|
|
3%
|
|
|
Share-based
compensation
|
|
2%
|
|
|
|
|
|
|
|
Non-GAAP projected operating
margin range
|
|
34%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Refer to the discussion of
non-GAAP financial measures included in the accompanying press
release for additional information.
|
|
|
|
|
|
SOURCE CA Technologies