Corel Corp. (Nasdaq: CORL) officials said the comeback is complete and investors were buying into the story as shares soared 41 percent, up 2 13/16 to 9 3/4, Tuesday.
Corel easily topped estimates with strong third quarter results.
"I believe that this quarter fully delivers on the promise we made almost two years ago to return Corel to a position of financial strength and sustainable profitability," Corel CFO Michael O'Reilly said. "I believe that with the turn-around now behind us, Corel is in a solid position for growth, and our outlook for Q4 remains positive."
In fiscal third quarter released after market close Monday, the maker of graphics and office productivity software reported net income of 17 cents per share, not including one-time events. First Call's survey of four analysts predicted a profit of 12 cents per share for the quarter ended Aug. 31.
Third quarter revenue was essentially flat at $71.3 million compared to $71.1 million in the year earlier period, when Corel lost $7.8 million, or 13 cents per share. "We've had a very strong quarter," said Michael Cowpland, Corel's president and CEO. "We are pleased with the acceptance of our recent releases of CorelDRAW and WordPerfect and look forward to continued profitability with the development of these products for different segments of the market."
Including non-recurring items, Corel posted a profit of $17.6 million, or 26 cents per share. The company gained 9 cents a share from a $6.3 million cash settlement from the government. The settlement was announced June 25 for a major supply deal that unfairly favored Microsoft Corp.
Monday's announcement marks the second consecutive strong quarter for Corel. The company smashed analyst estimates in the second quarter.
Corel shares have risen recently on optimism about forthcoming Linux products. The stock closed Monday's regular trading at 6 15/16, up 5/8 for the session.>