Lower operating costs helped JDA Software Group Inc. post a 29 percent increase in second-quarter net income despite lower-than-expected revenue.
But the increase was less than analysts expected, and the company’s stock plunged $2.78, or 9 percent, in after-hours trading. The earnings were released after major markets had closed.
The Scottsdale-based producer of supply-chain software and services reported Tuesday that it earned $10.1 million, or 24 cents per share, in the quarter compared with a $7.8 million, or 19 cents per share, profit reported for the second quarter of 2010.
Revenue was $162.4 million, up nearly 3 percent from the $158.4 million in sales posted a year earlier.
Analysts were looking for per-share earnings of 54 cents and sales of $169.7 million.
“Second-quarter software sales did not meet our expectation,” said Hamish Brewer, JDA’s president and CEO.
The modest overall-sales increase reported by the company was driven by a 10 percent jump in services revenue, to $65.6 million. Sales of software and related maintenance contracts fell 2 percent, to $96.9 million, due to substantially lower software sales in North America and the Asia Pacific region. But, Brewer added that the company expects an unusually strong third quarter, which, when combined with a typically strong fourth period, should enable the company to meet its initial full-year sales forecast.
While the company reported a 6 percent drop in its gross profit to $90.6 million, it trimmed operating expenses 10 percent, to $71.5 million, which helped the bottom line.
Source:http://www.azcentral.com/arizonarepublic/business/articles/2011/07/27/20110727jda-software-posts-profit-increase.html
