Computer Associates 2016 Annual Report Download - page 50

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Selected Quarterly Information
Fiscal 2016 Quarter Ended
June 30(1) September 30(1) December 31(1) March 31(1) Total(1)
(dollars in millions, except per share amounts)
Revenue $ 977 $ 1,005 $ 1,034 $ 1,009 $ 4,025
Percentage of annual revenue 24% 25% 26% 25% 100%
Costs of licensing and maintenance $ 66 $ 70 $ 73 $ 74 $ 283
Cost of professional services $ 71 $ 78 $ 75 $ 76 $ 300
Amortization of capitalized software costs $ 60 $ 67 $ 65 $ 64 $ 256
Income from continuing operations $ 207 $ 172 $ 219 $ 171 $ 769
Basic income per common share from continuing operations $ 0.47 $ 0.39 $ 0.52 $ 0.41 $ 1.79
Diluted income per common share from continuing operations $ 0.47 $ 0.39 $ 0.52 $ 0.41 $ 1.78
Fiscal 2015 Quarter Ended
June 30(1) September 30(1) December 31(1) March 31(1) Total(1)
(dollars in millions, except per share amounts)
Revenue $ 1,069 $ 1,079 $ 1,091 $ 1,023 $ 4,262
Percentage of annual revenue 25% 25% 26% 24% 100%
Costs of licensing and maintenance $ 72 $ 71 $ 74 $ 80 $ 297
Cost of professional services $ 81 $ 88 $ 84 $ 85 $ 338
Amortization of capitalized software costs $ 67 $ 75 $ 62 $ 69 $ 273
Income from continuing operations $ 212 $ 235 $ 218 $ 145 $ 810
Basic income per common share from continuing operations $ 0.48 $ 0.53 $ 0.49 $ 0.33 $ 1.83
Diluted income per common share from continuing operations $ 0.48 $ 0.53 $ 0.49 $ 0.33 $ 1.82
(1) Information presented excludes the results of our discontinued operations.
Liquidity and Capital Resources
Our cash and cash equivalent balances are held in numerous locations throughout the world, with 76% held in our subsidiaries
outside the United States at March 31, 2016. Cash and cash equivalents totaled $2,812 million at March 31, 2016, representing
an increase of $8 million from the March 31, 2015 balance of $2,804 million. During fiscal 2016, there was a $24 million
favorable translation effect from foreign exchange rates on cash held outside the United States in currencies other than the U.S.
dollar.
Although 76% of our cash and cash equivalents is held by foreign subsidiaries, we currently neither intend nor expect a need to
repatriate these funds to the United States in the foreseeable future. We expect existing domestic cash, cash equivalents, cash
flows from operations and borrowings to be sufficient to fund our domestic operating activities and our investing and financing
activities, including, among other things, the payment of regular quarterly dividends, compliance with our debt repayment
schedules, repurchases of our common stock and the funding of capital expenditures, for at least the next 12 months and for the
foreseeable future thereafter. In addition, we expect existing foreign cash, cash equivalents and cash flows from foreign
operations to be sufficient to fund our foreign operating activities and investing activities, including, among other things, the
funding of capital expenditures, acquisitions and research and development, for at least the next 12 months and for the
foreseeable future thereafter.
Sources and Uses of Cash
Under our subscription and maintenance agreements, customers generally make installment payments over the term of the
agreement, often with at least one payment due at contract execution, for the right to use our software products and receive
product support, software fixes and new products when available. The timing and actual amounts of cash received from
committed customer installment payments under any specific agreement can be affected by several factors, including the time
value of money and the customer’s credit rating. Often, the amount received is the result of direct negotiations with the
customer when establishing pricing and payment terms. In certain instances, the customer negotiates a price for a single up-
front installment payment and seeks its own internal or external financing sources. In other instances, we may assist the
customer by arranging financing on the customer’s behalf through a third-party financial institution. Alternatively, we may
decide to transfer our rights to the future committed installment payments due under the license agreement to a third-party
financial institution in exchange for a cash payment. Once transferred, the future committed installments are payable by the
customer to the third-party financial institution. Whether the future committed installments have been financed directly by the
customer with our assistance or by the transfer of our rights to future committed installments to a third party, these financing
agreements may contain limited recourse provisions with respect to our continued performance under the license agreements.
Based on our historical experience, we believe that any liability that we may incur as a result of these limited recourse provisions
will be immaterial.
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