News Column

Fidessa Heralds "Return To Underlying Growth" Despite Sterling Hit

August 3, 2014

Samuel Agini

LONDON (Alliance News) - Fidessa Group PLC Monday reported a 3.9% fall in half-year pretax profit, with growth at constant currency more than offset by sterling strength.

In a statement, the trading software and services group said it made a GBP19.7 million pretax profit in the six months ended June 30, compared with GBP20.5 million in the corresponding period last year. Revenue fell to GBP137.1 million from GBP139.3 million, while operating expenses fell to GBP117.4 million from GBP118.6 million.

Fidessa increased its interim dividend to 13.1 pence from 12.5p.

At constant currency, Fidessa reported increases of 4% in revenue, 5% in operating profit, and 6% in pretax profit.

"The first half of 2014 has seen a welcome return to underlying growth as we have continued to make progress across the business against a backdrop of slowly improving market conditions. As expected, the improving market conditions have resulted in a reduction in the headwind we have been suffering in recent years from consolidations, restructurings and closures in our customer base," Chief Executive Chris Aspinwall said in a statement.

Aspinwall said that improving market conditions have allowed some of the growth in Fidessa's derivatives platforms, service-based platforms, and regional expansion to flow through into overall growth rather than being masked by the decline in equities. And although Aspinwall welcomed the return to underlying growth, he noted that the strength of sterling is likely to be a factor in determining results in the remainder of the year, though he said the group expects it to be "transient".

Despite the currency troubles, Aspinwall said Fidessa is seeing improvement across its markets as it moves into the second half of the year.

"In particular, we are seeing increased interest in new functionality within our core markets as well as strong demand for our derivatives and service-based offerings. Due to the depth, longevity and severity of the financial crisis, we expect that the improvement we are seeing will be gradual and this combined with the effect of our recurring revenue model means that we expect modest constant currency growth for the year as a whole," he said.

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Source: Alliance News

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