Executives of software vendor CA welcomed mixed third-quarter results as a signal that the company is turning its fortunes around.

Revenue rose 4% to $1 billion (£508 million) in the third quarter of fiscal 2007, ended 31 December 2006, although the company saw its net income fall 7% to $52 million compared to $56 million in the year-ago quarter. Earnings per share (EPS) were $0.09, down from the previous year's $0.10.

"I am pleased with our third quarter performance," John Swainson, CA president and chief exceutive, said in a statement. He described three months in which the company witnessed "healthy demand' for its enterprise IT management software, particularly around technologies it had acquired. Revenue from professional services grew 11% year-on-year.

Discounting the impact of recent acquisitions and other factors, CA's net income was down 14% to $50 million compared to the third quarter of fiscal 2006, while EPS was $0.24.

A consensus estimate of Thomson Financial analysts had predicted that CA would report revenue of $985 million on an EPS of $0.21.

CA's realignment of its salesforce, which begun last year helped the company to retain, renew and expand key contracts, notably six licences agreements with an aggregate value of around $472 million, with one contract worth more than $100 million.

As part of its ongoing restructuring efforts, the vendor reported $14 million in severance costs and $15 million related to the closing of facilities. Back in August, CA announced plans to cut around 1,700 after net income for the first quarter of fiscal 2007 fell 64%.

For fiscal 2007, CA is predicting that revenue will come in above its earlier guidance of $3.9 billion, with an EPS of between $0.83 and $0.86.