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CTG’s profits weaken but match analyst forecasts

Computer Task Group’s first-quarter profits weakened but still managed to meet analyst forecasts as the Buffalo information technology company’s revenues fell by 12 percent.

CTG’s profits, excluding a $21.5 million write-down of goodwill within its healthcare business, fell by 50 percent to $648,000, or 4 cents per share, from $1.3 million, or 8 cents per share, a year ago, matching analyst forecasts.

Weakness in the company’s healthcare and manufacturing markets contributed to the drop in first-quarter revenues, which fell to $85.9 million from $97.5 million. That was less than the $87 million that analysts were expecting.

Cliff Bluestein, CTG’s CEO, said he was encouraged by the company’s ability to sign new customers during the quarter, with the firm adding nine new clients in its staffing business and five in its healthcare unit.

“The first quarter contains early indications of success,” Bluestein said during a conference call Tuesday. “These accounts are starting small and will increase over time.”

CTG said it expects to earn between 13 cents and 21 cents per share this year, which is on the low end of the 21 cents that analysts are forecasting. It predicted that sales would range between $338 million and $350 million, which is at the top end of the $349 million consensus forecast from analysts.

CTG said staffing revenues during the quarter were slightly weaker than expected because of sagging demand from Lenovo, one of its bigger staffing customers. The company’s health solutions and life sciences shares softened as electronic medical records work wound down.