SunGard's profit rises in Q3

SunGard's profit rises in Q3

SunGard's net income rose to $92 million for the three months ended September 30 2003, an 18% increase compared to Q3 2002.

Including merger costs, net income per share for the quarter grew 15% to 31 cents, compared to the 27 cents reported for the same period in 2002.

Despite the rise in profits, internal revenue remained largely unchanged compared to the same period last year.

Revenue for Q3 2003 was $742 million, an increase of 13% over the $660 million reported in the year-ago quarter, but revenue from businesses owned for at least a year was unchanged from the same period in 2002.

At SunGard's Investment Support Systems (ISS) division, revenue grew 18% to $404 million in the quarter due to acquisitions, but internal revenue declined one per cent for the quarter.

Availability Services (AS) revenue increased two per cent to $290 million in the quarter, due primarily to currency fluctuation, says the vendor.

Revenue from other businesses increased 46% to $48 million, mainly due to SunGard's acquisition of HTE, a provider of government information technologies, in March this year.

Cristobal Conde, president and chief executive officer, says over the last three years IT spending has been characterised by cost-cutting and an overriding focus on resilience, but claims customers are now putting an equal emphasis on gaining market share.

"As a result, we see an improvement in the size and quality of leads coming into our pipeline, especially for offerings on an ASP or outsourced basis where we can leverage our economies of scale and resilient IT infrastructure," says Conde.

For 2003, SunGard says it expects to earn between $1.23 and $1.28 per share, which includes one per cent per share of merger costs incurred through the end of September.

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