15th Oct 2013 08:31
LONDON (Alliance News) - Lombard Risk Management PLC Tuesday said it swung to a half-year pretax loss after an increase in administrative expenses and a rise in losses as a result of depreciation and amortisation.
Lombard Risk Management, which provides risk management software to banks and other financial institutions, said it made a GBP934,000 pretax loss for the six months to September 30, compared with a GBP1.3 million pretax profit for the corresponding period last year.
The strength of the Chinese Yuan against the Sterling was also a factor behind the swing, according to the company.
Revenue declined 5.0% to GBP7.3 million, but the most significant factors behind the swing to loss were a rise in administrative expenses and losses as a result of depreciation and amortisation.
"The first six months have seen further positive progress across the group, although recognised revenues have been impacted directly by delays to new regulatory products. This has led to a record order book as we move into the second half of the year," John Wisbey, chief executive, said in a statement.
The company said that the decline in revenue was offset by record order book of contracted revenue at GBP5.4 million, compared with GBP2.8 million last year.
However, administrative expenses were up to GBP7.1 million, compared with GBP5.6 million last year, as Wisbey said the company had to increase staffing levels to ensure that deadlines for 45 clients for its COREP product, including 16 new clients, are met.
COREP is the standardised reporting framework issued by the European Banking Authority.
Meanwhile, depreciation and amortisation losses widened to GBP1.0 million from GBP580,000.
However, Wisbey was confident in his outlook for meeting the market's full year revenue forecasts, citing that any new business in the next five and a half months will represent revenue growth for the year as a whole.
"Based on business already contracted or won, and assuming no further regulatory delays on COREP or other factors causing delays to project delivery, we believe we have already won enough business for the full year's revenues to equal or exceed last year's full year revenue number of GBP16.8 million," Wisbey said.
The company's non-executive chairman, Philip Crawford, added that the COREP product delivery should see full year revenues being "very much second half weighted".
Lombard shares were Tuesday quoted at 12.50 pence, down 1.0 pence or 7.4%.
By Samuel Agini; [email protected]; @samuelagini
Copyright 2013 Alliance News Limited. All Rights Reserved.
Related Shares:
Lombard Risk Management