Restructuring Helps Send BearingPoint To 1Q LossRestructuring Helps Send BearingPoint To 1Q Loss

BearingPoint on Thursday reported a loss in its first quarter ended Sept. 30. The IT outsourcing and professional-services firm posted a loss of $39.2 million, or 20 cents per share, compared with net income of $12.3 million, or 7 cents per share, a year ago. BearingPoint said the loss was caused in part by restructuring charges. On the upside, it said growth in its international operations helped revenue increase 1.4% year-over-year to $743 million, marking the fifth consecutive quarter in which it reported sales growth.

International revenue grew 42.6% to $239.2 million as BearingPoint expanded its presence in a number of areas. The United States wasn't one of them: Sales to the government grew 2.4% to $271.5 million, prompted mostly by strong sales to the federal government. But the firm said sales to the state, local, and educational markets all declined. Sales to the communications and media sector fell 34.2%, while sales in the consumer, industrial, and technology segments declined 23.1%. Financial-services sales were virtually flat. "The economic environment remains unchanged, with clients spending cautiously," chairman and CEO Rand Blazer said during a conference call. "It's an environment we aren't comfortable with."

Despite the tough quarter, American Technology Research analyst David Garrity says BearingPoint's growing international sales bode well for it and other IT-consulting firms. Garrity says he has a "buy" recommendation on the stock in part because "Europe is seen as having hit bottom." He also says he expects BearingPoint to announce three major public service wins over the next three months.