Mercury Computer Beats Estimates Despite Defense Slowdown

The company beats revenue and earnings estimates and offers 2002 guidance.

Author:: Michael Dunn
Publish date:: Apr 18, 2002 8:48 AM EDT

Mercury Computer Systems

beat earnings estimates despite a 65% drop in revenue caused by delays in defense spending.

The signal and image processing computer system manufacturer said its third-quarter net income was $2.7 million, or 12 cents a share, compared with earnings of 34 cents a share in the year-ago period. Analyst polled by Thomson Financial/First Call had been expecting 7 cents a share.

Revenue for the quarter fell to $34.9 million from $46.95 million a year ago,

Mercury said it experienced previously announced delays with its defense electronics business due to the replanning and refocusing of priorities caused by the war on terrorism. The company declined to forecast exactly how long it would be before the full impact of the return of this business is felt, but said it continues to see backlog and order improvement.

The company also offered a revised outlook for 2002, saying that it expects full-year EPS in the range of 63 cents to 71 cents on revenue of $149 million to $152 million, ahead of the First Call estimate of 59 cents on revenue of $144.83 million. For the fourth quarter, the company expects EPS of 18 cents to 26 cents on revenue of $42 million to $45 million, including its acquisition of Myriad Logic. Analysts are looking for EPS of 18 cents on revenue of $40.6 million.

Shares of Mercury closed at $29.90 before the news Wednesday.