Covansys, the services company that last month agreed to be bought by CSC for $1.3bn, reported higher net income for the first quarter on rising sales.
Net income for Q1 was $8.7m, or $0.22 per share, increased from $5.0m, or $0.13 per share, for the same period. Revenue jumped 7% to $117.9m from last year, but less than 1% sequentially from Q4 2006. Analysts were looking for EPS of $0.26 on $117m in sales.
In what may have outshined its rather tepid first-quarter numbers, Covansys said the Securities and Exchange Commission’s Midwest office has said it will recommend the SEC end its investigation–the subject of which the company didn’t disclose – and take no enforcement measures against the company. However, the recommendation of the Midwest office doesn’t mean the SEC follow that course of action, Covansys warned.
Covansys was mum on the details on the investigation, but last year it delayed its third-quarter filing due to the reassessment of its revenue recognition policies.