Thursday, 25 August 2011

Just How Much Bad News Can CSC Continue to Get Away With?

CSC will take a Q2 FY2012 charge of approx $250Million  for dispute settlement
CSC announced on August 24th 2011 a settlement of a contract dispute with the US Government.
Details are given in CSC's Form 8K filing with the SEC:
http://marketbrief.com/csc/8k/events-or-changes-between-quar/2011/8/24/8992697/filing


The company currently estimates the financial impact of the settlement as a $250million or $1.15 EPS. Before this announcement, the Analyst consensus estimate of CSC for Q2 was a profit of $0.69 per share(source: Google Finance). So is it now a loss of $0.46 per share?. 
CSC are "pleased" by the settlement. As a shareholder, I am not. It is yet another piece of bad news falling out of the sky. Can CSC tell us when the good news they keep promising will actually start?? 

It would also be useful to know what charges CSC will have to make in the contract dispute/renegotiation, with the UK Government over the NHS contract, and what likely charges are due for the failing services in Nordic countries following the strikes and lock outs, which hit the services from mthe Copenhagen data centres.


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