ADC falls, Q3 revenues below expectations
CHICAGO, Aug 19 (Reuters) - Shares of ADC Telecommunications Inc. fell about 7.0
percent Thursday as investors focused on lower-than-expected revenues in the company's
third quarter earnings report, which was released late Wednesday.
''There was a little bit of weakness in the sales figures,'' said Mark Cavallone, analyst with
S&P Equity Group. ''Revenues relative to the Street consensus were about 2 percent off.''
Around midday Thursday, shares of ADC were off 3-1/16 at 40-13/16 on Nasdaq on turnover of more than 3.6 million
shares.
Minneapolis-based ADC, a provider of software for communications networks, reported third quarter operating earnings of
$0.37 per diluted share compared to $0.30 in the year-ago period.
A consensus of analysts' estimates pegged ADC's third quarter profits at $0.34, according to First Call/Thomson Financial,
which tracks such data.
Revenues were $444.1 million, compared to $362.5 in the year-ago quarter but analysts' noted flat earnings in the company's
Integrated Solutions services unit.
''(Integrated Solutions) sales were $52 million, sequentially flat and below our estimate of $62 million,'' ABN-AMRO analyst
Kenneth Leon wrote in a research note. Both analysts said ADC expected its Integrated Services clients to resume their
interest for the fourth quarter and revenues should rebound.
''Any time you see weakness in revenues for a tech company it's a little disquieting, but the (ADC's) revenue outlook for the
future is good,'' Cavallone said.
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