CSC fed business on strong
Although overall profits were weak for 2001, the company's federal business continued to grow
Computer Sciences Corp. announced Monday that although its overall profits for fiscal 2001 and for the fourth quarter of 2001 were weak, the company's federal business continued to grow.
CSC's net income for fiscal 2001, which ended March 30, was $233 million, down from $403 million in fiscal 2000. However, fourth-quarter revenue of $2.9 billion represented growth of more than 16 percent, and annual revenue of $10.5 billion was also up about 16 percent from fiscal 2001.
CSC attributed lower-than-expected revenue and poor profits to weakness in the global consulting and systems integration business; shortfalls in health care software license sales and related services; revised cost estimates for some fixed-price contracts; and price pressures on outsourcing.
Federal government revenue is the largest component of consulting and professional services activities at CSC.
Federal government revenue increased to $707.2 million in the fourth quarter, up 8.6 percent from the $651.2 million recorded in last year's fourth quarter. Civilian agency business rose 10 percent to $255.7 million, up from $232.3 million last year.
The Internal Revenue Service's modernization program, some NASA awards and task-order contracts from other civil agencies accounted for that increase, according to a CSC statement. Revenue from CSC's Defense Department contracts was $451.5 million, up 7.8 percent from last year's $418.9 million. Much of that increase was from task orders and the Army Logistics Modernization award.
Revenue from the federal government for all of fiscal 2001 increased to $2.62 billion from $2.27 billion in fiscal 2000.
"Our federal opportunity pipeline through fiscal 2004, at approximately $29 billion, is as strong as it has ever been for a 35-month period," said Van Honeycutt, CSC's chairman, president and chief executive officer. CSC's private-sector outsourcing experience will contribute to the company's success as it pursues modernization programs in the federal market, he said in a statement.
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