SunGard publishes first quarter 2005 results

SunGard has reported that net income for the three months ended March 31st, 2005 was $90 million, a 5 percent increase over the first quarter of 2004.

Diluted net income per share grew 3 percent to $0.30. Merger costs and costs associated with the previously planned spin-off of Availability Services were $0.01 per share in the quarter. Also in the first quarter of 2005 was a one-time charge of $11.5 million related to the relocation of an availability services facility. Before merger and spin-off costs and the one-time facility charge, diluted net income per share was $0.34 for the quarter, representing an increase of 17 percent from the first quarter of last year.

Revenue for the first quarter increased 13 percent to $947 million. Internal revenue (revenue from businesses owned for at least one year and excluding revenue from Brut LLC) was up 5 percent from the same period in 2004, with the impact of favourable exchange rates contributing approximately 1 percent.

Cristobal Conde, president and chief executive officer, said, "SunGard performed solidly in the quarter and is well positioned to grow competitively. The recent announcement of the acquisition of SunGard by a consortium of seven of the world's leading private equity investment firms is a resounding endorsement of our business model, industry leadership and financial strength. The reaction from customers has been positive. We continue to be committed to improving customer satisfaction, delivering high levels of service and deepening relationships with our customers. Now and following the completion of the transaction it is business as usual at SunGard."

The acquiring consortium, which has agreed to pay $36 in cash for each SunGard share, was organized by Silver Lake Partners and includes Bain Capital, The Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co. L.P., Providence Equity Partners and Texas Pacific Group.

The transaction is subject to receipt of stockholder approval and customary regulatory approvals as well as satisfaction of other customary closing conditions. SunGard filed its preliminary proxy statement with the Securities and Exchange Commission on April 12, 2005.

SunGard filed its Hart-Scott-Rodino notification with the Federal Trade Commission and the Department of Justice on April 15, 2005. The transaction is expected to close in the third quarter of 2005.

Availability Services’ revenue increased 10 percent to $317 million for the quarter. Internal revenue increased approximately 2.5 percent for the quarter. The impact of favourable exchange rates contributed approximately 1 percent to revenue growth in the quarter. Margins declined by approximately 570 basis points in the quarter due to the initial impact of a recently acquired business and a charge related to the relocation of an Availability Services facility.

SunGard expects growth in internal revenue in its Availability Services business to be in the low to middle single digits for the full year 2005.

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