CDC Corp., the diversified parent company of CDC Software, reported on Thursday that sales of its enterprise software remained flat year over year, totaling $89.5 million for the third quarter ended Sept. 30, 2008.
License sales for CDC Software, the corporation’s biggest division,
dropped 16% year over year to $12.8 million. Software consulting and services revenue fell 15% to $21.1 million. Meanwhile, maintenance sales and global services revenue both grew 12%, logging nearly $24 million each.
At the corporate level, only an 83% run-up in sales at CDC’s Games unit, which offers video games across various media platforms, kept overall revenue from a year-over-year decline. Total sales at CDC Corp. came in at $103.8 million, up from last year’s Q3 total of $98.4 million.
CDC Corp. managed to shrink its net loss to $7.2 million from $10.2 million in the year-ago quarter. In a statement, CEO Peter Yip preferred to focus on EBITDA, or earnings before interest, taxes, depreciation, and amortization.
"On a stand-alone basis, both CDC Software and CDC Games posted strong adjusted EBITDA from continuing operations performance, and we plan to look for opportunities to capitalize on these results when and if the equity markets recover,” Yip said. “Overall, despite the difficult economic backdrop, we remain cautiously optimistic with regard to our near-term prospects."
The company pointed to customer wins in the quarter that included Pinnacle Foods Group, LLC, a food manufacturer that installed CDC Factory at three of its U.S. plants; tomato manufacturer Red Gold, another CDC Factory customer; and Starkey Labs, a hearing aids company that chose CDC Pivotal CRM.
Yip said that in quarters to come, CDC will focus on selling its three primary products — CDC Factory, CDC Supply Chain, and CDC Respond — into its installed base of 6,000 customers worldwide.
Asked by an analyst on a conference call yesterday whether CDC could grow revenue in 2009, Yip answered, “I would not think that our revenue would not be able to grow.” He cited the Games unit as the main driver, however, noting that “software is [in a] difficult environment, but we ... have grown modestly in EBITDA.”