Computer Associates 2007 Annual Report Download - page 106

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UNAUDITED (IN MILLIONS) 2006 2005
FOR THE YEAR ENDED MARCH 31,
Revenue $ 3,880 $ 3,711
Income (loss) from continuing operations 109 (29)
Net income (loss) 112 (29)
Basic earnings (loss) per share:
Income (loss) from continuing operations $ 0.19 $ (0.05)
Discontinued operations 0.01 —
Net income (loss) $ 0.20 $ (0.05)
Diluted earnings (loss) per share:
Income (loss) from continuing operations $ 0.18 $ (0.05)
Discontinued operations 0.01 —
Net income (loss) $ 0.19 $ (0.05)
During the first quarter of fiscal year 2006, the Company acquired the common stock of Concord, including its Aprisma
Management Technologies subsidiary, for an aggregate purchase price of approximately $359 million. The Company
converted options to acquire the common stock of Concord and incurred acquisition costs of approximately $15 million
and $7 million, respectively. Concord was a provider of network service management software solutions, and the Company
has integrated Concord’s network management products into the Company’s Unicenter Enterprise Systems Management
suite. The acquisition of Concord has been accounted for as a purchase and, accordingly, its results of operations have been
included in the Consolidated Financial Statements since the date of its acquisition, June 7, 2005 (the Concord Acquisition
Date). The pro-forma results shown above do not include the results of Concord as Concord was not considered a significant
subsidiary at the time of acquisition.
The acquisition cost of Concord has been allocated to assets acquired, liabilities assumed, and in-process research and
development based on estimated fair values as follows:
(IN MILLIONS)
Cash $18
Marketable securities 58
Deferred tax assets 31
Other assets acquired 44
Purchased software products 18
In-process research and development 4
Customer relationships 19
Trademarks/tradenames 3
Goodwill 351
Deferred revenue (19)
Deferred tax liabilities (24)
3% convertible notes payable (86)
Other liabilities assumed (58)
Purchase price $359
Approximately $4 million of the purchase price represents the estimated fair value of projects that, as of Concord Acquisition
Date, had not reached technological feasibility and had no alternative future use. Accordingly, this amount was immediately
expensed and has been included in the “Charge for in-process research and development costs” line item in the Consolidated
Statement of Operations for the fiscal year ended March 31, 2006.
94