17th Feb 2014 08:28
LONDON (Alliance News) - Fidessa Group PLC said Monday that full-year revenue remained steady and pretax profit increased by 3%, though warned that while it expects to see a reduction in "headwinds to the business," during the year, 2014 figures are likely to be hit by continued attrition.
In its preliminary results for the year to December 31 2013, Fidessa said its revenue remained relatively steady at GBP279.0 million, up from GBP278.6 million the previous year. Pre-tax profit also rose by 3%, reaching GBP43.1 million for the year, from GBP42 million in 2012.
Operating profit was up 3% to GBP42.9 million from GBP41.7 million last year.
The firm said that it saw conditions improve throughout its customer markets during the year, including a good base of new derivatives signings, doubling its multi-asset revenue in its derivatives programme and an increased interest in service-based solutions on both the buy-side and the sell-side.
The firm added that 57% of its total revenue is now accounted for outside of Europe and that growth in recurring revenues has risen, now 85% of total revenues.
Chris Aspinwall, Chief Executive, said, "2013 has seen the first real improvement in the trading conditions faced by our customers since the start of the financial crisis over five years ago. As reported with the interim results, and consistent with the duration and depth of the downturn, this improvement has been somewhat uneven and means that many of our customers are still not able to make investment decisions with confidence."
Due to this, Fidessa said it saw some attrition and price pressure - albeit at a lower level than that seen during the previous year.
"Despite this pressure," said Aspinwall, "We have sustained and increased our investment programme, expanding our capabilities across asset classes, services and regions, and continued to win new business. Our success in taking market share has allowed us to grow our important recurring revenues whilst our customers' tight focus on managing discretionary spending has meant that we have seen a reduction in consultancy revenue. As predicted in the interim results, the increase in our investment programme, particularly around our derivatives initiative as we build out our functional offering and roll out our first global platforms, has had a small impact on margin."
Looking ahead, Fidessa said it is seeing continued operating improvements within its markets, which it said is reflected in its current deal pipeline. As these improvements filter through the business, the company said it should result in a gradual reduction in the the headwinds it faces, which it hopes will convert the sales growth of its derivatives platforms, service-based platforms and its regional expansion to flow through into overall revenue growth rather than, "being masked by the decline in equities."
While expecting these factors to continue to boost its results over the coming year, Fidessa warns that the impact of the attrition felt during last year will flow to 2014 results, to some degree, leading to modest currency growth for the full-year.
The firm remains positive, with Aspinwall predicting that the firm can return to growth levels closer to those seen in the past as stability and opportunity returns to the markets, the headwind reduction, as well as utilising further openings as its multi-asset initiative gains momentum.
"We remain excited by the potential of our service-based offerings across all asset classes and segments of our market and believe that we will continue to play an important role as customers focus on efficiency, transparency, compliance and performance," he added.
To demonstrate its confidence for the future, the firm has also retained its special dividend payment - its fifth in a row - at 45 pence per share. Fidessa's annual dividend per share has also been retained, payable at 37 pence per share.
Also announced, the company's Finance Director, Andy Malpass has informed the board of his intention to retire in 2015, after serving with the firm for nearly 20 years.
Shares in Fidessa were trading down 2.63% at 2,259 pence per share Monday morning, one of the biggest decliners on the FTSE 250.
By Alice Attwood; [email protected]; @AliceAtAlliance
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