Intuit Inc (INTU) recently signed an agreement to sell Intuit Real Estate Solutions (IRES) to Vista Equity Partners for approximately $128 million in cash. Based in Highland Hills, Ohio, IRES is part of Intuit’s global business division and is a leading provider of software and services to companies in the real estate management and investment industry. 

Vista Equity Partners is a leading private equity firm with more than $2.5 billion in committed equity capital, focused on investments in software and technology-enabled businesses. Intuit Real Estate Solutions revenue totaled approximately $74 million in fiscal year 2009 and was expected to be approximately $80 million in fiscal year 2010. 

Management still expects its fiscal year 2010 revenue to grow between 4% and 8%, excluding IRES. Intuit does not expect this sale to have a meaningful impact on operating income or earnings per share guidance. IRES contributed $4 million to 2009 operating income and was expected to contribute approximately $8 million in fiscal 2010. 

Intuit expects that the approximately 2-cent reduction in earnings per share resulting from the sale of IRES will be offset by other savings. Earlier, the company reported an in-line first quarter but provided a disappointing forecast for the second quarter. The company is yet to find a significant improvement in business sentiment among small business customers who use the company’s flagship products such as QuickBooks software and Turbo Tax programs. 

Management expects revenues between $3.3 billion and $3.43 billion in fiscal 2010, up 4% – 8%. Earnings per share are projected between 29 cents and 32 cents. Revenues for the second quarter are projected between $800 million and $835 million, up 1% – 6%. Earnings per share are expected to come between 15 cents and 18 cents. 

Given the disappointing forecast by the management, we would like to stay on the sidelines as of now. With signs of revival, the business momentum should pick up, though. California-based Intuit is a leading provider of business and financial management solutions. Its flagship products and services include QuickBooks, Quicken and TurboTax.
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