Information-technology company CA Inc. (CA) raised its full-year
earnings outlook, saying an appeal of its past federal income tax
payments has resulted in a lower tax rate.
The software maker now expects adjusted profit to grow around
16% to 20% in the year ended March 2014, indicating a range of
roughly $2.93 to $3.03 at recent exchange rates. Its previous
outlook called for earnings to decline by 4% to 7%.
CA recently completed an Internal Revenue Service appeals
process related to its tax returns for fiscal years 2005, 2006 and
2007. As a result, the company now projects a 2014 tax rate of
around 14%, compared with its previously projected rate of 31%.
The company expects to post a benefit of $165 million to $185
million to its net income in the current quarter, as well as a cash
refund of $70 million to $80 million by the end of the second
quarter of the fiscal year.
CA earlier this week reported its fourth straight quarterly
sales decline, warned of continuing weakness, and said it would cut
1,200 jobs.
Shares closed Thursday at $26.81 and were unchanged after hours.
Through the close, the stock was up 22% since the start of the
year.
Write to Kristin Jones at kristin.jones@dowjones.com
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