BusinessCorporate FinanceEDS hit by share options expensing

EDS hit by share options expensing

Share option expensing takes shine off EDS figures

A new accounting procedure has blunted positive quarterly figures for IT services group EDS.

Link: EDS: Is the criticism deserved?

The NYSE-listed company posted pro forma net income of $35m (£18.4m), but the impact of stock option expensing – which it adopted from 1 January – contributed to a final net income of $4m. However, the adjusted figure was still better than its Q1 2004 loss of $12m.

Total quarterly revenue was $4.94bn, down 5% on Q1 2004, but still at the higher end of estimates.

‘EDS got off to a solid start in 2005, as our operational improvements continued to gain traction,’ said chairman and CEO Mike Jordan. ‘In an increasingly competitive market, we posted our strongest signings quarter since 2002 while continuing to invest in our capabilities. At this point we believe EDS is on track to deliver on our long-term turnaround goals.’

Contract award highlights during the quarter included its $3.85bn deal with the MoD.

It also expects to post a pro forma 2 to 7 cents per share loss for the year, due mainly to the adverse affect of a previously-disclosed one-time pension charge related to the loss of the Inland Revenue IT contract in its UK operations.

Related Articles

Grant Thornton recruits new corporate finance partner

Accounting Firms Grant Thornton recruits new corporate finance partner

11m Emma Smith, Managing Editor
Total fraud value at £2bn five-year high, finds BDO

Accounting Firms Total fraud value at £2bn five-year high, finds BDO

11m Stephanie Wix, Writer
MHA MacIntyre Hudson appoints corporate finance director

Accounting Firms MHA MacIntyre Hudson appoints corporate finance director

11m Stephanie Wix, Writer
Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

Consulting Tyrie on Finance Bill 2017: ‘Making Tax Policy Better’

11m Stephanie Wix, Writer
KPMG announces senior partner promotion in Newcastle

Accounting Firms KPMG announces senior partner promotion in Newcastle

11m Stephanie Wix, Writer
Independent city firm reports 70% growth

Accounting Firms Independent city firm reports 70% growth

11m Stephanie Wix, Writer
Tax avoidance crackdown sees 80% jump in additional HMRC revenue

Accounting Firms Tax avoidance crackdown sees 80% jump in additional HMRC revenue

11m Stephanie Wix, Writer
Making Tax Digital: the "unexpected item in the bagging area"

Accounting Standards Making Tax Digital: the "unexpected item in the bagging area"

11m Stephanie Wix, Writer