Computer Science Corporation gently pared back its expectations for the rest of the year yesterday as it unveiled it second quarter financial results.
The El Segundo, California-based services company turned in sales of $2.7bn for the quarter ending September 27, a 1.2% slip on last year. Net income was up 36.2% to $92.9m, delivering earnings per share of $0.54. The figures were in line with analysts’ estimates. For the first six months, sales were up 0.3% to $5.5bn, with net income up 48.3% to $171.9m.
The company said the market for global IT services had been declining for several quarters, especially in the area of corporate discretionary spending. At the same time, it pointed to growth in its global commercial outsourcing and US federal government business.
Looking ahead, CSC said it saw no significant improvement in demand for IT consulting and systems integration services in North America, and that it continued to experience weaker demand for short term project related work outside North America. The European market continues to be challenging, it said.
In the second half of the current financial year, it expects revenues to grow in the 2% to 4% range, with the fourth quarter stronger than the third. Earnings per share for the full year are now expected to be in the low to mid-$2.60 range. Wall St had been expecting the company to turn in earnings of $2.68.
In the second quarter, US federal government business was up 16.9% to $772.1m. Department of Defense business was up 13.1% to $449.7m, while civil agencies business was up 22.6% to $322.4m. Global Commercial business was down 6.9% to $1.96bn. US commercial revenue was down 8.2% to $958.7m, while European revenue was down slightly to $706.7m, while the rest of the world was down 11.8% to $294.9m.