"CA has reported another solid quarter, capping a fiscal year that saw the Company make significant progress," said CA Chief Executive Officer John Swainson. "We focused our direct sales force and our channel partners on forging strong business relationships with our customers and on selling new software licenses to new and existing customers, which resulted in double-digit bookings growth for the year. We also made considerable progress on our expense management, driving strong improvements in our operating margins.

"We entered fiscal year 2009 with good momentum and will continue to focus in this current economic environment on doing the things that drive revenue and increase profit, on developing the market's most innovative IT management software products, and on achieving overall operational excellence," Swainson continued. "We are issuing an annual outlook that reflects our operational momentum and our confidence in our ability to execute."

Total revenue for the fourth quarter was $1.085 billion, up 8 percent, or 2 percent in constant currency, from $1.005 billion reported in the same period last fiscal year. For the full fiscal year, revenue was $4.277 billion, up 8 percent, or 4 percent in constant currency, from the $3.943 billion reported in fiscal year 2007.

Total North American revenue was up 2 percent in the fourth quarter while revenue from international operations was up 16 percent, or 3 percent on a constant currency basis, compared with the same period last year.

Total product and services bookings in the fourth quarter were $1.468 billion, up 30 percent compared with $1.133 billion reported in the prior year period. For the full fiscal year, total product and services bookings were $4.537 billion, up 15 percent from the $3.938 billion reported in the 2007 fiscal year. During the year, the Company signed 61 license agreements greater than $10 million, for a total of about $1.4 billion, compared with 42 license agreements totaling about $1.1 billion in fiscal year 2007. The weighted average of direct bookings in fiscal year 2008 was 3.22 years, compared with 3.29 years in the prior fiscal year.

Total expenses, before interest and income taxes, for the fourth quarter were $935 million, a decrease of 8 percent, compared with $1.017 billion in the prior year period. The fourth quarter was affected positively by a decrease in amortization of capitalized software and lower restructuring costs compared with last year's comparable period. In the fourth quarter, GAAP operating income, before interest and income taxes, was $150 million, representing an operating margin of 14 percent, an improvement from the prior year period's operating loss. Total expenses, before interest and income taxes, for the 2008 fiscal year were $3.423 billion, a decrease of 8 percent, compared with the $3.729 billion reported in fiscal year 2007. Full year total expenses also were affected positively by a decrease in amortization of capitalized software and lower restructuring costs compared with the last fiscal year. For the full year, GAAP operating income, before interest and income taxes, was $854 million, representing an operating margin of 20 percent, a 15 percentage point improvement over the prior-year period.

On a non-GAAP basis, which excludes purchased software and intangibles amortization, and restructuring and other costs, the Company reported fourth quarter operating expenses of $831 million, virtually flat with the $830 million reported in the prior year period. Excluding the negative impact of currency, fourth quarter non-GAAP operating expenses were down 6 percent year-over-year. For the fourth quarter, non-GAAP operating income, before interest and incomes taxes, was $254 million, up 45 percent from the prior year period and representing a non-GAAP operating margin of 23 percent, a 6 percentage point improvement from the fourth quarter of fiscal year 2007. The Company reported full year non-GAAP operating expenses of $3.177 billion, up slightly from the $3.160 billion reported in the prior year. Excluding the negative impact of currency, non-GAAP operating expenses were down 3 percent year-over-year. For the full year, non-GAAP operating income, before interest and income taxes, was $1.100 billion, representing an operating margin of 26 percent, a 6 percentage point improvement year-over-year. Excluding stock-based compensation, the full-year non-GAAP operating margin was 28 percent.

The Company reported fourth-quarter GAAP income from continuing operations of $71 million or $0.13 per diluted common share, compared with a loss of $20 million or ($0.04) per diluted common share a year earlier. For the full year, GAAP income from continuing operations was $500 million, or $0.93 per diluted common share, compared with $121 million, or $0.22 per diluted common share in fiscal 2007.

CA recorded non-GAAP income from continuing operations of $117 million for the fourth quarter, or $0.22 per diluted common share, compared with $109 million, or $0.20 per diluted common share, reported a year earlier. For the full fiscal year, non-GAAP income from continuing operations was $642 million, up 29 percent from the $499 million recorded in fiscal year 2007, while non-GAAP earnings per diluted common share was $1.19, an increase of 35 percent, over the $0.88 reported in fiscal year 2007.

Both GAAP and non-GAAP income from continuing operations were affected by several discrete tax charges in the fourth quarter, which reduced full-year GAAP earnings per share by 2 cents per share and non-GAAP earnings by 6 cents per share. In addition, GAAP earnings per share in the fourth quarter were reduced by 4 cents due to increased restructuring expenses.

The Company reported cash flow from operations of $690 million in the fourth quarter, up 32 percent compared with $521 million in the fourth quarter of fiscal year 2007. Cash flow from operations for the full fiscal year was $1.103 billion, up 3 percent from the $1.068 billion reported in the prior-year period. The Company recorded restructuring payments of $22 million in the fourth quarter and $92 million for the full 2008 fiscal year.

Capital Structure

The balance of cash, cash equivalents and marketable securities at March 31, 2008, was $2.796 billion. With $2.582 billion in total debt outstanding, the Company has a net cash position of $214 million.

Outlook for Fiscal Year 2009

The Company issued its fiscal year 2009 annual outlook based on current expectations. The following represents "forward-looking statements" (as defined below).

Total product and services bookings growth in the mid- to- high single digits;
Total revenue growth of 2 to 4 percent in constant currency, or $4.5 billion to $4.6 billion when translated at current foreign currency exchange rates, representing reported growth of 5 to 7 percent.
GAAP earnings from continuing operations per common diluted share of $1.28 to $1.35. The outlook includes about $30 million in charges related to previously disclosed restructuring plans;
Non-GAAP operating earnings per share of $1.45 to $1.52 per diluted common share, an increase of 22 percent to 28 percent; and
Full-year cash flow from operations of $1.150 billion to $1.180 billion, an increase of 4 percent to 7 percent. The outlook includes about $120 million in payments related to previously disclosed restructuring plans and cash taxes flat with fiscal year 2008.
Except as otherwise noted, guidance reflects current foreign currency exchange rates, assumes no acquisitions and a partial hedge of operating income.

The Company anticipates approximately 517 million shares outstanding at fiscal 2009 year-end and a weighted average diluted share count of approximately 541 million for the fiscal year. The Company also expects a full-year tax rate on non-GAAP income of approximately 37 percent.

A reconciliation of each non-GAAP measure referenced in this press release to its most directly comparable GAAP financial measure is included in the tables provided as part of this news release.

This news release and the accompanying tables should be read in conjunction with additional content that is available on the Company's website, including a supplemental financial package and related slide presentation as well as a webcast that the Company will host at 5 p.m. ET today to discuss its fourth quarter and full fiscal year 2008 results. The webcast will be archived on the website. Individuals can access the webcast, as well as this press release and supplemental financial information, at http://ca.com/invest or listen to the call at 1-877-809-1564. International participants can listen to the call at 1-706-634-8757.-CA newsCA