CSC Profit Falls, 10-Q Delayed

The tech services company says it will delay the filing because of its stock-options probe.
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Computer Sciences'

(CSC)

preliminary second-quarter results missed earnings estimates by a penny, but revenue was essentially in line with the Wall Street average.

The IT services company said Thursday that it will delay the filing of its 10-Q until the investigation into its stock-options grant practices is complete and it has determined the tax and accounting charges.

CSC posted a net income of $92.6 million, or 53 cents a share, compared with $99.5 million, or 53 cents a share a year ago.

Excluding certain items, CSC reported a profit of $122.3 million, or 70 cents a share, lower than the $132.6 million, or 71 cents a share in the same period last year.

On that basis, EPS missed analysts' target of 71 cents a share.

Sales for the quarter totaled $3.61 billion vs. $3.57 billion in the same quarter last year, slightly higher than the $3.58 billion analysts had forecast.

For the third quarter, CSC said revenue will range from $3.6 billion to $3.7 billion and EPS will be in the low- to mid-80-cent range.

Analysts polled by Thomson First Call expect EPS of $1.01 on sales of $3.68 billion.

For the full year ending March 2007, CSC CEO Van Honeycutt said revenue should grow 2% to 3%, and EPS will range from $3.71 to $3.81. Analysts expect EPS to hit the low end of the range on sales of $14.83 billion.

Shares slipped 9 cents to $52.98 in after-hours trading.