September 10, 2009 / 12:24 PM / in 8 years

UPDATE 2-Descartes Systems Q2 profit beats Street view

* Q2 adj EPS $0.10 vs est $0.08

* Revenue up 9 pct

* Shares up as much as 8 pct (Adds byline, conference call details, analysts comments; updates share movement)

By Sakshi A Mattoo

BANGALORE, Sept 10 (Reuters) - Canada's Descartes Systems Group Inc (DSG.TO) (DSGX.O), which provides logistics management software and services, reported a rise in quarterly adjusted profit that also beat market estimates, helped by a growth in its services revenue, sending its shares to a 52 week-high.

On a conference call with analysts, Chief Executive Arthur Mesher said Descartes is "extremely active" in its attempts to acquire companies within the $10 million range in the coming quarters.

The company is currently interested in sectors like wireless GPS, homeland securities and supply chain execution, Mesher added.

Descartes has a history of acquiring small companies within the $3 million to $10 million range, PI Financial analyst Pardeep Sangha said, adding that he expects another acquisition in the next six months.

Our distributors are selling more right now and we haven't moved them to the on-demand model yet at a wholesale level, so a lot of our business still comes on a license format, Mesher added.

"The company does have momentum going behind it, you should see that continue to the third quarter," Laurentian Bank Securities analyst Alex Grassino said.

Third quarter is generally strong because it is the quarter before Christmas and there is a lot of shipping in trade volumes, Sangha said, adding that the company is in the range of getting another record quarter.

Q2 BEATS STREET

For the second quarter ended July 31, net income was $812,000, or 2 cents a share, compared with $1.4 million, or 3 cents a share, a year ago.

Adjusted net income was 10 cents a share for the period.

Total revenue rose 9 percent to $18.6 million, while revenue from its services segment was up 7 percent to $17.1 million.

Analysts were expecting earnings of 8 cents a share, before items, on revenue of $17.7 million, according to Reuters Estimates.

Shares of the Waterloo, Ontario-based company were trading up 30 Canadian cents at C$5.31 Thursday afternoon on the Toronto Stock Exchange. They touched a high of C$5.42 earlier in the session. (Editing by Anil D'Silva and Pradeep Kurup)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below