BEA Falls Despite Beating Estimates

Caught in a general decline among technology stocks, BEA Systems (Nasdaq: BEAS) was down US$2.69 at $39.25 early Friday, despite beating analyst estimates in the fourth quarter ended January 31st and sounding an upbeat note about the year ahead.

UBS Warburg reportedly upgraded BEA shares to strong buy from buy followingthe report, while Robertson Stephens and US Bancorp Piper Jaffray were saidto have repeated buy recommendations.

The San Jose, California-based maker of e-commerce software said revenue for the quarter rose 72 percent from a year earlier to $149.2 million, aided by$158.9 million in license fees.

“Our license growth rate, both sequentialand year-over-year, accelerated again this quarter,” BEA chairman and chief executive officer Bill Coleman said. “We exceeded the goal we settwo years ago of 20 percent pro forma operating margin.”

Income before charges and other items totaled $43.8 million, or 10 cents pershare, up from $17.2 million, or 5 cents, in the previous year and a pennyahead of analyst expectations.

Net income totaled $18.95 million, or 5cents per share, compared with a year-earlier loss of $13.68 million, or 4 cents.

“We experienced the operating leverage that software companies can achieveas revenue grows, while continuing to invest aggressively in our salescapacity,” Coleman said.

Coleman added: “Due to the economic climate that others areexperiencing, we were able to hire a record number of sales representativesand research and development staff last quarter, thus improving ourpotential for growth this year.”

According to Coleman, many companies in the industry continued to build their e-businesses, “improving our confidence in our ability to meetour goals for the first half of fiscal 2002.”

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