Corel, which is best known for its CorelDraw, WordPerfect and WinZip programs for graphics, word processing and file compression, posted a net loss of $6.8m for the quarter, on revenue that spiked up to $60.4m (27 cents EPS), from $41.3m a year ago.
In the same 2006 quarter Corel made a profit of $5.5m.
It was a one-time tax charge of around $5m related to the $196m acquisition of video and DVD software maker InterVideo last year that bit into Ottawa-based Corel’s profits. The non-cash tax expense established a valuation allowance against deferred tax assets as part of the acquisition.
Corel’s total operating expenses for the quarter also rose in the quarter, from $39.5m to $24m.
Corel CEO David Dobson said that five of the company’s key products, WinZip, iGrafx, Designer and our Painter business, all returned double-digit growth in the quarter, which helped to push revenue up.
Dobson also commented that InterVideo is exceeding the company’s expectation in terms of cost and expense reductions.
We’re through what I would call the heavy lifting of the integration and are now focused on growth.
Corel’s adjusted profit of 31 cents EPS beat analyst expectations by a cent.
For the upcoming fourth quarter Corel guided on revenue of between $66m and $70m, and adjusted EPS of 43 cents and 52 cents a share, the top end of which still falls short of analysts expectations by a penny.
The company also lowered its fiscal 2007 outlook, predicting an adjusted EPS loss of between $1.30 and $1.40, on a revenue range of $244m to $248m.
The analyst consensus for the year is adjusted EPS of $1.34 on revenue of $250.7m.
