Portal Software Plunges Despite Beating Estimates

Portal Software (Nasdaq: PRSF) fellUS$2.62 to $7.12 Thursday morning, even after beating analyst estimatesfor the fourth quarter, as officials reportedly warned that results for thecurrent quarter might fall short of expectations.

“We experienced solid performance in the fourth quarter despite an uncertainmarket,” said chief financial officer Jack Acosta. “We remain optimistic about our business and market position,but given the current macroeconomic conditions, are taking a cautiousapproach to managing our cost structure over the next few quarters.”

Following the warning, analysts at Goldman Sachs reportedly downgraded Portal shares to marketperform from market outperform, and Prudential was reported to have loweredits rating to hold from accumulate.

Acosta reportedly told investors on a conference call that revenue for thefirst quarter of fiscal 2001 could be flat to lower, while earnings willcome in at breakeven to a penny per share, below analyst expectations forper-share income of 3 cents.

For the fourth quarter ended January 31st, revenue rose 108 percent from ayear earlier to $81.1 million, while income before extraordinary itemsincreased to $6.9 million, or 4 cents per share, from $369,000, orbreakeven.

The company posted a net loss for the latest quarter of $18million, or 11 cents per share, including $24.9 million in costs related tothe November acquisition of Solution42.

Portal shares received a boost earlier this week, when the company unveileda new version of its flagship software product and said it signed anagreement with the UK division of mobile telecommunications company Vodafone.

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