CA Technologies
Jan 21, 2014

CA Technologies Reports Third Quarter Fiscal Year 2014 Results

Revenue Decreases 2 Percent in Constant Currency and 3 Percent as Reported

GAAP EPS Decreases 7 Percent in Constant Currency and as Reported

Non-GAAP EPS Grows 33 Percent in Constant Currency and as Reported

Cash Flow From Operations Decreases 24 Percent in Constant Currency and as Reported

Updates FY 2014 Outlook for Revenue, EPS and Operating Margin

NEW YORK--(BUSINESS WIRE)-- CA Technologies (NASDAQ:CA) today reported financial results for its third quarter fiscal year 2014, ended December 31, 2013.

FINANCIAL OVERVIEW

     
(dollars in millions, except share data)     Third Quarter FY14 vs. FY13
FY14     FY13     % Change    

% Change
CC**

Revenue $ 1,163     $ 1,195     (3 )%     (2 )%
GAAP Net Income $ 232     $ 251     (8 )%     (9 )%
Non-GAAP Income* $ 379     $ 286     33 %     33 %
GAAP Diluted EPS $ 0.51     $ 0.55     (7 )%     (7 )%
Non-GAAP Diluted EPS* $ 0.84     $ 0.63     33 %     33 %
Cash Flow from Operations $ 429     $ 566     (24 )%     (24 )%

* 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

"CA Technologies delivered another solid performance in the third quarter," said Mike Gregoire, CA Technologies chief executive officer. "We outperformed on revenue and are pleased with our renewals business and disciplined approach to cost control. We also saw good traction with our recent acquisitions Layer 7 and Nolio, which both had strong performances.

"While I'm encouraged by our performance in Q3, we need to continue to improve our execution across development, marketing and sales," Gregoire continued. "Based on our results so far this year, we expect our fiscal year 2015 revenue growth rate and non-GAAP operating margin to be similar to fiscal year 2014.

"We are driving significant improvements in our products and go-to-market, including the release of organic innovation such as CA Cloud Storage for System z and the launch of a new ad campaign in select airports around the world as well as online.

"With two months to go in the fiscal year, we are more focused than ever on delivering great products, increasing market awareness of CA and our capabilities, and accelerating the velocity of our efforts to sell more software to more customers," Gregoire concluded.

REVENUE AND BOOKINGS

     
(dollars in millions)     Third Quarter FY14 vs. FY13
FY14     % of
Total
    FY13     % of
Total
    %
Change
    %
Change
CC**
North America Revenue $ 729     63 %     $ 745     62 %     (2 )%     (2 )%
International Revenue $ 434     37 %     $ 450     38 %     (4 )%     (2 )%
Total Revenue $ 1,163           $ 1,195           (3 )%     (2 )%
   
North America Bookings $ 1,017     63 %     $ 685     54 %     48 %     49 %
International Bookings $ 586     37 %     $ 576     46 %     2 %     2 %
Total Bookings $ 1,603           $ 1,261           27 %     28 %
   
Current Revenue Backlog $ 3,457           $ 3,495           (1 )%     0 %
Total Revenue Backlog $ 7,634           $ 7,488           2 %     3 %

**CC: Constant Currency

EXPENSES AND MARGIN

   
(dollars in millions) Third Quarter FY14 vs. FY13
FY14     FY13     %
Change
    %
Change
CC**
GAAP  
Operating Expenses Before Interest and Income Taxes $ 829       $ 825       0 %     2 %
Operating Income Before Interest and Income Taxes $ 334       $ 370       (10 )%     (11 )%
Operating Margin   29 %       31 %            
Effective Tax Rate   27 %       30 %            
   
Non-GAAP*    
Operating Expenses Before Interest and Income Taxes $ 707       $ 771       (8