Compuware Corporation Announces Fourth Quarter and Fiscal Year 2000 Financial Results

FARMINGTON HILLS, Mich. -- May 1, 2000 -- Compuware Corporation (NASDAQ:CPWR) today announced financial results for its fourth quarter and fiscal year ended March 31, 2000.

Compuware reports fourth quarter revenues of $582.1 million, an increase of 16.4 percent from $500.1 million in the fourth quarter of the previous fiscal year. Before amortization expense (amortization of intangible assets acquired in purchase acquisitions), income from operations decreased 49.6 percent to $90.9 million from $180.2 million in the same quarter of the previous year. Including amortization expense, income from operations decreased 56.4 percent to $77.9 million from $178.7 million during the same quarter last year. Net income before amortization expense decreased 54.1 percent to $57.5 million from $125.2 million in the same quarter last year. Including amortization expense, net income decreased 62.5 percent to $46.5 million from $124.0 million in the same quarter last year. Earnings per share before amortization expense (diluted computation) decreased 51.6 percent to 15 cents from 31 cents, based upon 381.0 million and 403.2 million shares outstanding, respectively. Including amortization expense, earnings per share (diluted computation) decreased 61.3 percent to 12 cents from 31 cents in the same quarter of the previous year.

During the company's fourth quarter, software license fees decreased 15.6 percent to $196.1 million from $232.4 million in the same period of the previous fiscal year. Maintenance fees increased 28.2 percent to $118.2 million from $92.2 million during the same period last year. Revenue from professional services grew 52.5 percent during the quarter to $267.7 million from $175.6 million in the fourth quarter of the previous fiscal year.

During the fiscal year ended March 31, 2000, revenues increased 36.1 percent to $2.231 billion from $1.638 billion, an increase of $592.2 million. Before special charges and amortization expense, income from operations increased 17.9 percent from $510.6 million to $602.1 million. Including special charges and amortization expense, income from operations during the fiscal year increased 10.1 percent to $551.3 million from $500.6 million. Before special charges and amortization expense during fiscal year 2000, net income increased 9.8 percent to $392.2 million from $357.3 million. Including special charges and amortization expense, net income increased 0.6 percent to $352.0 million from $349.9 million in the previous fiscal year. Earnings per share before special charges and amortization expense (diluted computation) increased 14.6 percent to $1.02 from 89 cents, based upon 384.7 million and 402.0 million shares outstanding, respectively. Earnings per share including special charges and amortization expense (diluted computation) increased 4.6 percent to 91 cents from 87 cents.

During the year, software license fees increased 19.9 percent to $819.2 million from $683.4 million and maintenance revenue grew 29.4 percent to $432.7 million from $334.4 million. Professional services fees increased 57.7 percent to $978.7 million from $620.7 million.

"Despite a tough fourth quarter, we delivered solid results for fiscal year 2000," said Beth Chappell, Executive Vice President, Investor Relations and Corporate Communications, Compuware Corporation. "Our software business remains healthy and will continue to grow. We will maintain our competitive edge in the OS/390 market as we strive to significantly increase sales of our distributed software products."

Chappell continued: "Plans for our professional services business are on track. Our training initiatives are going very well, and unassigned headcount has been reduced by one-third since March of this year."

Highlights for Fourth Quarter, 2000

Compuware established its first two Digital Development Centers. Located in Kansas City, Missouri and Farmington Hills, Michigan, the centers provide a complete range of e-commerce services from web site strategy, conceptualization, creation and performance management to back-office architecture, legacy integration and load testing.

Compuware and Ford Motor Company announced an agreement to fully implement Application Management Centers (AMCs) in the United Kingdom and Germany. Compuware AMCs provide large organizations with the resources to manage their entire application portfolio, freeing them to focus on strategic Information Technology issues. Compuware also announced an agreement with Morgan Stanley Dean Witter & Co. to establish an Application Portfolio Management Solution Center for the financial services firm in the Minneapolis/St. Paul area.

Compuware Corporation

With fiscal year 2000 revenues of more than $2.2 billion, Compuware is a world leader in the practical implementation of enterprise and e-commerce solutions. Compuware productivity solutions help 14,000 of the world's largest corporations more efficiently maintain and enhance their most critical business applications. Providing immediate and measurable return on information technology investments, Compuware products and services improve quality, lower costs and increase the speed at which systems can be developed, implemented and supported. Compuware employs more than 15,000 information technology professionals worldwide. For more information about Compuware, please contact the corporate offices at 800-521-9353. You may also visit Compuware on the World Wide Web at http://www.compuware.com.