Business

CDC Corp Stock Jumps On Higher Expectations

CDC Corporation's (CHINA) stock jumped over US$10 for the first time in many years after the company announced that its subsidiary CDC Software expects to report record software license revenues for the fourth quarter of 2006.

CDC Software expects to report record software license revenues in the range of US$13.8 million to US$14.2 million for Q4 2006. This would represent an increase of approximately 37% compared to software license revenues of US$10.2 million in Q4 2005, and an increase of approximately 18% from US$11.9 million in the third quarter of 2006, the prior record quarter.

"Our preliminary estimates indicate that our growth rate in software sales continues to be strong with back-to-back record-setting quarters," said Eric Musser, president of CDC Software. "This performance is further evidence that our organic growth trend is continuing, primarily due to the success of our strategy and positioning as vertical industry specialists. For the past two years, we have consistently driven 40 to 50 percent of software license revenue from new-logo customers and we believe that this uniquely strong mix of organic revenues positions us for continued growth in target markets, especially our key vertical industries including Financial Services, Homebuilding, Food and Beverage, Life Sciences and Chemicals."

The company plans to report preliminary earnings estimates for the fourth quarter of 2006 by early February.

"We are very pleased with our preliminary results for CDC Software this quarter," said Peter Yip, CEO of CDC Corporation. "We are especially excited by our success with new customers and we expect this trend to continue in the coming quarters as we continue to build market momentum with our industry-specific solutions."

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