Compuware sees disappointing Q1

FARMINGTON HILLS: Corporate software maker Compuware Corp. said on Friday it

expects disappointing fiscal first-quarter earnings of 7 to 9 cents per diluted

share before amortization expenses.

That is well short of the 15 cents a share analysts had been expecting,

according to First Call/Thomson Financial.

Compuware's stock was down 1-1/2 to $8-3/4 a share in mid-afternoon Nasdaq

trading after sinking as low as 8-21/32. That is below the previous 52-week low

of $9-1/4 a share and well off the year's high of $40.

Compuware is scheduled to announce its results for the quarter on July 18.

It was the second consecutive quarter in which the company warned that

earnings would fall short of analysts' expectations. In April it warned about

weaker fourth-quarter results in its professional services and products

divisions. Shares fell heavily that day on the news.

Citing weakness in the software market, the Farmington Hills, Michigan-based

company on Friday estimated its revenues for the fiscal first quarter ended June

30 to be between $490 million and $510 million.

Software license fee revenues are estimated in a range of $120 million to

$130 million. Maintenance revenues are estimated at $115 million. Revenues from

professional services are estimated in a range of $255 million to $265 million.

"We are very disappointed with our software sales results,"

spokeswoman Beth Chappell said in a statement.

"In spite of our best efforts to work closely with the investment

community to set reasonable and attainable expectations for the quarter, the

softness of the market had a significant impact on our results. Once again, we

had several large deals that did not come in at the end of the quarter,"

she added.

"Our professional services business is on track with guidance,"

Chappell said. "We expect a minus 2 to 3 per cent margin for the quarter in

services and are pleased to note that we had a slightly positive services margin

in May and expect similar results for June. This represents a 5 to 6 per cent

margin improvement over last quarter."

(C) Reuters Limited 2000.