Stock Watch: Breakeven Q2 Powers webMethods

webMethods, Inc. (Nasdaq: WEBM) rose 10 3/8 to 95 3/8 Thursday after reporting breakeven earnings before items in the second quarter ended September 30th, beating analysts’ expectations.

The Fairfax, Virginia-based maker of business-to-business (B2B) integration software said revenue for the quarter surged 310 percent from a year earlier to $45.7 million, one-third of which resulted from the acquisition of Active Software.

The loss before charges totaled $64,000, or breakeven per share, compared with a loss of $6.6 million, or 46 cents per share. Analysts had expected a loss of 11 cents per share in the latest quarter.

After all charges, the company posted a net loss of $48.8 million, or $1.04 per share.

“By any measure of financial performance, our second quarter was a great success,” said president and chief executive officer Phillip Merrick. “Breaking even in the same quarter that we completed our acquisition of Active Software is a powerful indication of the success of this integration.”

Prudential Securities said the results appear to show that the Active Software merger is “going better than expected.” The firm maintains a buy rating on webMethods, and predicts the stock will reach 165 in a year.

webMethods acquired e-business software maker Active Software in August in exchange for 13.9 million common shares.

WebMethods said it added 88 new customers during the quarter, for a total of more than 500. It also expanded partnerships with Deloitte Consulting, EDS and Ariba and opened offices in Australia, Japan, Korea, Singapore and Taiwan.

“We continue to see very strong growth within the Global 2000 market and momentum from industry-backed exchanges,” Merrick said.

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