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Novell meets earnings expectations

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Network software maker Novell met expectations for its fourth quarter today, with a favorable settlement of an outstanding income tax issue accounting for a one-time jump in the company's earnings.

Novell reported earnings of $74 million, or 21 cents per share---a 76 percent increase compared to the $42 million of the same period a year ago. Revenue for the quarter was $345 million.

But taking into account the resolution of an outstanding Internal Revenue Service tax issue that boosted the company's profit per share by 4 cents, Novell reported earnings that were in line with analyst estimates of 17 cents per share for the quarter, according to First Call.

The tax issue resolution relates to the company's 1994 through 1997 tax years.

Novell continued to see adoption of its latest version of NetWare-- its core operating system product--drive its business. Versions of the operating system that include directory software technology called NDS were up 17 percent for the quarter and accounted for $176 million.

Novell, under the guidance of chief executive Eric Schmidt, has attempted to expand its strategy beyond NetWare, pushing NDS as a technology base that third-party developers can write programs to. Novell's NDS essentially serves as a yellow pages for anything attached to a network, including devices, computers and software.

The company has also developed several software programs that take advantage of NDS in order to spur interest in the technology.

For the year, Novell reported an 87 percent increase over the previous year in net income to $191million, or 55 cents per share. Income for its previous fiscal year was $102 million, or 29 cents per share.

Revenue for the company's fiscal 1999 was $1.273 billion.

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