* Q4 adj EPS $0.30 vs est $0.28
* Q4 rev down 2 pct
* Sees 2011 rev up by 5 pct
* Shares down 2 pct (Recasts, adds conference call details)
March 4 (Reuters) - Chip-design software maker Mentor Graphics Corp (MENT.O) posted marginally better-than-expected quarterly results, as it managed to modestly cut costs, but warned of a possible loss for the current quarter.
The company said though the general business environment was improving, it was not yet confident about the sustainability of the recovery, as customers remained cautious.
Mentor said it would for now restrict formal outlook to a single quarter.
For the current first quarter ending April 30, the company expects to either break even or post a loss of up to 5 cents a share. Analysts were expecting a profit of 4 cents a share, according to Thomson Reuters I/B/E/S.
Mentor said it was looking to grow full year 2011 revenue by 5 percent. At that rate, Mentor's 2011 revenue would stand at $842.8 million, compared with expectations of $836.2 million.
In the fourth quarter, the average dollar value of renewals for the top ten contracts grew 25 percent, even as total bookings declined 5 percent.
The company saw better customer adoption of new products, as new customers rebounded to 35 percent growth, while smaller contracts, which turn in less than $1 million in revenue, rose low double digits.
In the first quarter to date, small contracts are up 50 percent, the company said on a conference call with analysts.
For the fourth quarter ended Jan. 31, 2010, the company's net profit grew 27 percent to $39.4 million, or 39 cents a share.
Excluding items, Mentor earned 30 cents a share, beating analysts' estimates of 28 cents a share, according to Thomson Reuters I/B/E/S. [ID:nWNAB5641]
Shares of the Wilsonville, Oregon-based company fell 2 percent to $8.60 in extended trading, after closing at $8.78 Thursday on Nasdaq. (Reporting by Sayantani Ghosh in Bangalore; Editing by Maju Samuel)