BMC Meets Revised First-Quarter Estimates

The software company reports revenues of $326 million for the first fiscal quarter of 2005.

Citing delayed purchasing decisions among large U.S. customers, BMC Software Inc. on Tuesday announced, as expected, revenues of $326 million and earnings of 23 cents per share for its first fiscal quarter of 2005.

The revenue and earnings were within the revised estimates that the Houston management software provider gave earlier this month, which were lower than its April expectations. Still, revenues were up 5 percent over the same quarter a year earlier, and earnings were well over the loss of 3 cents a share in the first fiscal quarter of 2004.

At the same time, license revenues were off by 20 percent compared with last year.

"A significant number of transactions did not close at the end of the quarter, mainly in the U.S. A large number of software companies reported they experienced several delays. The slowdown in the customer procurement process was unexpected," said Bob Beauchamp, president and CEO of BMC, in the earnings call Tuesday morning.

The reason for the slowdown is unclear, Beauchamp said. "They might have concern about the macro economy; it may be they are holding out to negotiate harder. We dont know yet. It was clear it was broad-based and within North America and Germany," added Beauchamp.

BMC closed its acquisition of Marimba Inc. on July 15, and Marimba software has already been integrated with BMCs Remedy software.

BMC expects in its second fiscal quarter of 2005 to generate revenues in the range of $340 to $355 million, and expects earnings per share of between 12 cents and 16 cents. Those estimates are not based on Generally Accepted Accounting Principals, officials said.

The revenue and earnings range includes an estimated $10 million in revenue and the negative earnings-per-share impact of 1 cent from the Marimba acquisition.

BMC expects double-digit license bookings growth in the second quarter.

For the full 2005 fiscal year, BMC expects revenues to be in the range of $1.46 billion to $1.49 billion. Earnings per share on a non-GAAP basis are expected to fall between 64 cents and 74 cents a share. Those estimates include $30 million in revenue and a negative 2 cents a share from the Marimba acquisition.


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