5th Nov 2013 11:16
LONDON (Alliance News) - First Derivatives PLC Tuesday said it is performing in line with current market expectations, despite a 14% decline in its pretax profit as a result of higher administrative expenses.
The capital markets software and consultancy firm said it made a GBP3.0 million pretax profit for the six months to August 31, down from the GBP3.5 million reported for the corresponding period in 2012.
First Derivatives' declining profit figure came about despite a 9% increase in gross profit on the back of a faster increase in revenues than in the cost of sales, as higher administrative expenses, predominantly because of an increase in sales salary costs after the company recruited sales staff in Europe, North America and Asia.
The company, which is working with the commercial technology division of NYSE Euronext to create a new historical data service, said that holding back profit now will enable the business to deliver sales growth in the second-half and beyond, while it expects better margins in the second-half of the year as it starts to enjoy the fruit of its investment.
The 25% percent increase in revenues to GBP34.4 million was the result of growth across all of First Derivatives' regions and divisions, including a 47% increase in software sales to GBP11.0 million.
"The fundamentals of the business are strong and the size of the capital markets and the sectors we are targeting are huge. The group is well positioned to succeed and will continue to meet the challenges encountered to capitalise on the market opportunities that we have developed. With the current activity levels and pipeline we expect to report further growth in line with market expectations for the year to February 2014," Seamus Keating, Chairman, said in a statement.
"We have won a number of high profile contracts which we will deliver through the remainder of this year and have a healthy pipeline of prospects. We have maintained the momentum gained in the second quarter of the year and expect to report profits for the year in line with market expectations," Keating added.
First Derivatives increased its interim dividend to 3.2 pence per share, up from 3.1 pence for the corresponding period last year.
First Derivatives shares were Tuesday quoted at 835.00 pence, up 1.5%.
By Samuel Agini; [email protected]; @samuelagini
Copyright © 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
FD Technologies