Net Income Up In CDC Software’s Third Quarter
CDC Software Corp. generated $48.6 million during its third quarter, down from $60.5 million in third-quarter 2008. The company’s net income rose from $4.2 million to $6.2 million during the same period. The most recent quarter ended Sept. 30.
The software firm’s drop in revenue came primarily from a falloff in a drop in license fees, from $11.9 million a year ago to $7.6 million, as well as a plunge in professional service revenue from $21.2 million to $14.9 million. The company’s maintenance revenue was comparably stable, declining from $26.4 million a year ago to $25.4 million.
CDC kept the costs of its revenue consistent, at 56% of revenue during both periods. But it grew its operating margin from 9%, or $5.6 million a year ago, to $7.2 million or 15%, for the quarter just ended.
Much of the boost to operating income came from cutting sales and marketing expenses. These stood at $12.8 million a year ago, but fell to $7.8 million during third-quarter 2009. The company additionally trimmed $2.3 million from its research and development expenses, which fell from $6.3 million a year ago to $4 million.
The company has added seven new resellers as part of a strategy to increase its sales in China during the next few years. CDC indicated India, Australia, Mexico and China are hot growth areas for it.
