CDC Software Corporation (NASDAQ: CDCS), a global provider of
hybrid enterprise software solutions and services, announced today,
based on preliminary financial estimates and projections, as well
as the recent sales momentum the company has seen which include two
recent seven figure sales deals, the company reaffirms its guidance
provided on July 29, 2010. CDC Software expects 2010 Non-GAAP
earnings per share(a) to be in a range of $1.02 to $1.08 per share,
and 2010 Non-GAAP revenue(a) to be in the range of $215 million to
$225 million.
These 2010 estimates are supported by the company’s total
contracted backlog (TCB) of over $140 million. CDC Software
believes that TCB provides improved visibility into revenue
performance for future periods.
In addition, the company is providing an update on its share
buyback program. Since September 2009, the company, management and
certain affiliates of the company have purchased an aggregate total
amount of approximately 788,018 shares at an average price of $9.34
per share. Of that total, the company has purchased 737,299 shares
and management, including the CEO, has purchased 50,719 shares. The
company and its CEO continue to repurchase its shares in the open
market through a 10b5-1 trading plan.
“We believe the recent sell-off in CDC Software shares is
unwarranted, and in fact, provides an opportunity for long-term
investors, and that is why we are demonstrating our commitment
through our repurchases,” said Peter Yip, CEO of CDC Software. “We
see our third quarter progressing well, with our recent sales
traction, and we are very pleased on our strong second half
pipeline totaling more than $74 million. In addition, we expect to
see an improvement in our operating cash flow in the second half of
2010 compared to the first half of 2010. With our solid financial
foundation and our confidence in our long-term prospects and hybrid
enterprise software strategy, we believe CDC Software represents a
compelling investment opportunity.”
About CDC
Software
CDC Software (NASDAQ: CDCS), The Customer-Driven Company™, is a
hybrid enterprise software provider of on-premise and cloud
deployments. Leveraging a service-oriented architecture (SOA), CDC
Software offers multiple delivery options for their solutions
including on-premise, hosted, cloud-based Software as a Service
(SaaS) or blended-hybrid deployment offerings. CDC Software’s
solutions include enterprise resource planning (ERP), manufacturing
operations management, enterprise manufacturing intelligence,
supply chain management (demand management, order management and
warehouse and transportation management), global trade management,
e-Commerce, human capital management, customer relationship
management (CRM), complaint management and aged care solutions.
CDC Software’s recent acquisitions are part of its “acquire,
integrate, innovate and grow” strategy. Fueling the success of this
strategy is the company’s global scalable business and
technology infrastructure featuring multiple complementary
applications and services, domain expertise in vertical markets,
cost effective product engineering centers in India and China, a
highly collaborative and fast product development process utilizing
Agile methodologies, and a worldwide network of direct sales and
channel operations. This strategy has helped CDC Software deliver
innovative and industry-specific solutions to more than 8,000
customers worldwide within the manufacturing, distribution,
transportation, retail, government, real estate, financial
services, health care, and not-for-profit industries. For more
information, please visit www.cdcsoftware.com.
About CDC Corporation
The CDC family of companies includes CDC Software (NASDAQ: CDCS)
focused on enterprise software applications and services, CDC
Global Services focused on IT consulting services, and outsourced
R&D and application development, CDC Games focused on online
games, and China.com, Inc. (HKGEM:8006) focused on portals for the
greater China markets. For more information about CDC Corporation
(NASDAQ: CHINA), please visit www.cdccorporation.net.
(a) Adjusted Financial Measures
This press release includes Non-GAAP earnings per share and
Non-GAAP revenue, which are not prepared in accordance with
generally accepted accounting principles in the United States
(“GAAP”) (collectively, the "Non-GAAP Financial Measures"). We
believe that these Non-GAAP Financial Measures are helpful in
understanding our past financial performance and our future
results. Non-GAAP Financial Measures are not alternatives for
measures such as revenue and earnings per share prepared under
GAAP. These Non-GAAP Financial Measures may also be different from
non-GAAP measures used by other companies. Non-GAAP Financial
Measures should not be used as a substitute for, or considered
superior to, measures of financial performance prepared in
accordance with GAAP.
Investors should be aware that these Non-GAAP Financial Measures
have inherent limitations, including their variance from certain of
the financial measurement principals underlying GAAP, should not be
considered as a replacement for GAAP performance measures, and
should be read in conjunction with our consolidated financial
statements prepared in accordance with GAAP. These supplemental
Non-GAAP Financial Measures should not be construed as an inference
that the Company's future results will be unaffected by similar
adjustments determined in accordance with GAAP. Please see
reconciliations of Non-GAAP Financial Measures to GAAP which are
included in our earnings press release for the second quarter ended
June 30, 2010.
Special Note Regarding CDC Software Financial Projections and
Guidance
The financial estimates and guidance contained herein apply only
to CDC Software Corporation, a subsidiary of CDC Corporation. These
estimates and guidance amounts do not apply to, and are not
indicative of, the expected consolidated financial performance of
CDC Corporation, or the expected financial performance of CDC Games
Corporation, China.com, Inc. or any of their respective
subsidiaries. Investors are cautioned not to place reliance on the
financial estimates and guidance set forth herein for purposes of
any investment decision with respect to the shares of CDC
Corporation, and should read the foregoing in conjunction with the
reports and other materials filed with the United States Securities
and Exchange Commission by CDC Corporation and CDC Software
Corporation, from time to time.
Cautionary Note Regarding Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995, including statements relating to, among other
things, our beliefs and expectations about revenue and earnings per
share performance for 2010 and 2011, our beliefs regarding the
utility of TCB in estimating revenue performance, our beliefs
regarding recent market activity in our shares, our beliefs and
expectations for operating cash flow performance and other metric
for future periods, and other statements which are not historic
fact. These statements are based on management's current
expectations and are subject to risks and uncertainties and changes
in circumstances. There are important factors that could cause
actual results to differ materially from those anticipated in the
forward-looking statements, including the following: (a) the
ability to realize strategic objectives by taking advantage of
market opportunities in targeted geographic markets; (b) the
ability to make changes in business strategy, development plans and
product offerings to respond to the needs of current, new and
potential customers, suppliers and strategic partners; (c) the
ability to integrate operations or new acquisitions in accordance
with the company's and its subsidiaries’ business strategies; (d)
the effects of restructurings and rationalization of operations;
(e) the ability to address technological changes and developments
including the development and enhancement of products; (f) the
ability to develop and market successful products and services; (g)
the entry of new competitors and their technological advances; (h)
the need to develop, integrate and deploy products and services
that meet customer's requirements; (i) the possibility of
development or deployment difficulties or delays; (j) the
dependence on customer satisfaction with the company's and its
subsidiaries’ products and services; (k) continued commitment to
the deployment of the company’s and its subsidiaries’ products and
services, including enterprise software solutions; (l) risks
involved in developing software solutions and integrating them with
third-party software and services; (m) the continued ability of the
company's enterprise software solutions to address client-specific
requirements; and (n) demand for, and market acceptance of, new and
existing enterprise software and services and the positioning of
the company's solutions. Further information on risks or other
factors that could cause results to differ is detailed in our
filings or submissions with the United States Securities and
Exchange Commission, including our Annual Report on Form 20-F for
the year ended December 31, 2009, as filed with the SEC on June 2,
2010, and those of our ultimate parent company, CDC Corporation.
All forward-looking statements included in this press release are
based upon information available to management as of the date of
the press release, and you are cautioned not to place undue
reliance on any forward looking statements which speak only as of
the date of this press release. The company assumes no obligation
to update or alter the forward looking statements whether as a
result of new information, future events or otherwise. Historical
results are not indicative of future performance.
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