$1.4B loss at CSC; adjusted profit tops forecasts

Computer Sciences names new CEO, reports $1.4 billion 3Q loss; adjusted profit beats estimates

Associated Press

FALLS CHURCH, Va. (AP) -- Technology services provider Computer Sciences Corp. said Wednesday it swung to a $1.4 billion net loss in its fiscal third quarter as it recorded a $204 million charge for problems with its contract with Britain's National Health Service.

But the company reported adjusted earnings much higher than analysts expected on average, and its shares rose almost 18 percent by midday.

CSC also announced the appointment of Mike Lawrie as president and chief executive officer, succeeding Michael Laphen. Board member Rodney Chase will become chairman.

Laphen had previously announced his plan to retire as chairman, president and CEO.

Lawrie, 58, who is the CEO of British information technology company Misys PLC, is expected to assume the top position at CSC by March 31.

CSC's net loss for the quarter that ended Dec. 30 amounts to $8.96 a share, compared with net income of $242 million, or $1.54 a share, a year earlier.

Fiscal third-quarter revenue fell 5.8 percent to $3.76 billion from $3.99 billion a year earlier.

Analysts on average expected adjusted earnings of 57 cents a share and revenue of $3.99 billion for the quarter, according to FactSet. The company said its adjusted earnings were $1.35 a share; the primary one-time cost it reported was $9.93 per share to reflect the drop in value of its contract with the British health service.

Shares of CSC, based in Falls Church, Va., jumped $4.72, or 17.8 percent, to $31.20 in midday trading Wednesday.

CSC reported in December that the British government had refused to renegotiate the contract for a new software system for patients' hospital records.

View Comments (0)