SAP Q3 sales, profit jump sends shares higher

SAP Q3 sales, profit jump sends shares higher

Stock Market Predictions

(Global Markets) - Germany's SAP (SAPG.DE), the world's biggest maker of business software, reported a jump in its third quarter sales and profits, sending its shares 2 percent higher on Friday.

"SAP's pipeline remains very strong and companies continue to invest in IT," SAP said in a statement, alleviating some of the fears of a slowdown in technology spending.

In the third quarter SAP said sales at its key software and software-related services business rose 16 percent from a year ago to 2.69 billion euros, with group sales of 3.41 billion beating a 3.32 billion consensus from Thomson Global Markets I/B/E/S.

Underlying operating profit for the group jumped 23 percent from a year ago to 1.13 billion euros ($1.5 billion), beating analysts' average forecast of 1 billion.

Reported profit numbers grew even faster due to a one-off gain of 723 million euros from the reduction of a litigation provision.

"While we believed that SAP will show a sound quarter, we are positively surprised in particular by the strong licenses," DZ Bank analyst Oliver Finger said in a note. "We think that the new products helped SAP to grow its top line."

Despite a strong third quarter SAP stuck to its outlook for the full year, citing the uncertain macroeconomic environment.

The company forecast in July it would reach the high end of its 10 to 14 percent growth forecast for software and related services in 2011, and said group operating profit would come in at the high end of the previously given range of between 4.45 billion euros and 4.65 billion.

SAP shares were 2 percent higher at 41.35 euros by 1032 GMT.

The company reports full results on Oct 26.

(Reporting by Tarmo Virki, Frankfurt Newsroom; Editing by Hans-Juergen Peters and Helen Massy-Beresford)

Read More

NCI shares nosedive on weak outlook

NCI shares nosedive on weak outlook

Stock Market Predictions

(Global Markets) - Shares of NCI Inc (NCIT.O) fell 33 percent to their lifetime low after the IT services provider gave a bleak full-year revenue outlook citing continued uncertainty in the United States federal sector.

The Reston, Virginia-based company, which caters to the U.S. federal government agencies, on Thursday said it expects revenue of $340 million to $360 million. Analysts on average were expecting $514 million, according to Thomson Global Markets I/B/E/S.

"A number of factors contributed to our bookings shortfall in 2011, including an unfavorable competitive environment, pricing pressures and delayed or cancelled procurements," President Brian Clark said in a statement.

Analysts at Wells Fargo said "NCIT's historic 'value' pricing for IT work is being under-cut by competitors, especially small businesses that have preferential bidding status." The analysts cut their rating on the company's stock to "underperform."

Shares of the company were down 30 percent at $8.00 in morning trading on the Nasdaq. They touched a low of $7.70 earlier in the session.

(Reporting by Rachana Khanzode in Bangalore; Editing by Maju Samuel)

Read More

Satyam Computer Services banned by The World Bank

Satyam Computer Services banned by The World Bank from providing software services. Satyam has banned for 8 years to provide any service to the World Bank. The decision was taken because of the reports of improper benefits to bank staff and lack of documentation on invoices caused by Satyam Computer Services. Satyam started providing IT services to the World Bank 5 years ago. There were allegations of bribery in 2005, but the matter died down. There have been other allegations against Satyam such as causing security breaches at the World Bank database and sensitive information.

Read More