Headlines:
SunGard 1Q Profits Rose 5%
SunGard Data Systems Inc., which is being bought by a consortium of private equity firms, reported that it had first-quarter net income of $90 million, 5% more than a year earlier.
The Wayne, Pa., transaction software vendor and disaster recovery services provider said revenue rose 13%, to $947 million.
Diluted earnings per share, including some expenses for merger and spinoff costs, rose 3%, to 30 cents. Excluding those items, the company said, earnings were 34 cents a share, beating Wall Street's expectations by 1 cent.
The availability services unit's revenue rose 10%, to $317 million. (That unit is the disaster-recovery part of SunGard.)
SunGard's decision last October to put the unit up for sale caught the attention of the seven private equity companies, and in March they agreed to buy the entire company for $11.3 billion.
The deal is expected to close in the third quarter; the spinoff plan has been called off.
SunGard's earnings outlook for the year is unchanged: $1.51 to $1.57 per share.
The SunGard deal has been described as a shift in the private equity business model, in which investors typically buy out struggling companies with the aim of turning them around at a profit.
Cristobal Conde, SunGard's company's president and chief executive, said in Thursday's earnings release that the deal "is a resounding endorsement of our business model." He said the consortium members are among "the world's leading private equity investment firms."
Key-Alogent in Remote Capture
KeyCorp has begun using an Alogent Corp. remote-capture deposit system for its corporate customers, Alogent announced.
Alogent, of Alpharetta, Ga., said that KeyCorp, which is based in Cleveland, has received and processed 3,500 checks using the technology.
Businesses have taken to remote capture, which lets them convert checks into images and transmit them to their banks for deposits. Banks like it because it helps them get business in areas where they have no branches.
Banks print out the images for settlement as image replacement documents. The long-term vision is to route them across image-exchange networks.
In August 2004, Key became one of the first banking companies to go live with Clearing House Payments Co.'s SVPCO check image exchange network. Key is using SVPCO in tandem with the former Bank One (the Chicago company that JPMorgan Chase & Co. acquired). The pair's exchange volume remains low.
Brian Geisel, Alogent's chief executive, said in an April 20 press release, "Taking deposit automation to remote points of presentment outside the bank itself enables KeyCorp to enhance revenue, improve customer retention, and accelerate new customer acquisition through differentiated service."
