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BMC Software Earnings Beat

The company also institutes a $1 billion share buyback plan.
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BMC Software


posted better-than-expected second-quarter earnings and raised its profit target for the full year, although the company's quarterly revenue came in shy of analyst estimates.

The Houston-based maker of system management software also set up a $1 billion share buyback plan.

BMC's net income for the September quarter rose to $42.3 million, or 19 cents a share, from $12.7 million, or 6 cents a share, a year earlier.

Excluding certain items, BMC posted earnings of $58.2 million, or 26 cents a share, topping Thomson First Call's mean analyst estimate by 3 cents a share. The results also beat the company's August forecast for per-share earnings of 20 cents to 25 cents.

BMC's revenue rose to $361 million from $355.1 million last year. Analysts had projected revenue of $361 million, while BMC's guidance called for revenue of $355 million to $370 million.

The company's top line was helped by a 10% rise in maintenance revenue, which grew to $220.7 million from $199.9 million a year earlier. That growth helped offset a slide in license revenue, which fell 12% to $117.2 million from $132.5 million. BMC said its license bookings were $107.3 million, down 27% from a year earlier but up 8% from the first quarter.

For the fiscal third quarter, BMC predicts earnings of 25 cents to 30 cents a share, in line with analysts' current forecast of 26 cents. The company sees third-quarter sales of $375 million to $395 million, bracketing the Wall Street estimate of $391 million.

BMC boosted its full-year earnings projection while standing pat on its revenue view. The company sees fiscal 2006 earnings of 97 cents to $1.03 a share, up from its August guidance of 90 cents to 96 cents. The projection excludes an estimated 57 cents a share in special items.

The company still sees full-year revenue of $1.49 billion to $1.52 billion. According to First Call, analysts expect earnings of 95 cents a share and revenue of $1.51 billion for the year ending in March.

During the second quarter, BMC spent $100 million to buy back about 5 million shares. The company said the latest $1 billion buyback authorization is in addition to the $34 million remaining under a previous plan.

BMC shares recently changed hands at $19.40 in after-hours trading, up 90 cents, or 4.9%. The shares lost 6%, or $1.18, during the regular session Wednesday to close at $18.50.