Micro Focus is still a work in progress regarding performance as it continues to shake off the disappointment of its last financial year (see Micro Focus: revenues flat, discussions on going) when poor sales execution and product management stalled growth.
At half time (to October 31 2011), revenue showed a slight improvement on the year ago period, edging up 1.6% to £219.1m but down 2.6% on a constant currency basis, as the company had advised in its most recent trading update. Pre tax profit numbers are better, up 19.9%, (14.2% constant currency), to $75.8m and adjusted operating profit came in at $86.7m (vs $76.2m in 2010).
Maintenance and consultancy revenues declined (from $121.3m to $117m cc and $17.5m to $14.6m cc respectively) but there was a reassuring rise in license revenue albeit modest - $87.5m vs $86.2 (cc). License sales is one of the markers for recovery obviously and should feed through to improved maintenance revenue, so it was good to see this metric moving the right way.
With the company stating “there is still much to correct within the business”, the ‘improving’ status tag will be with Micro Focus for a while yet but there is no doubt that it is making progress. Depressing economic times play to its strengths (application modernisation in particular) as organisations look to do more with their existing assets so the ill economic winds may bring the company some good along with its own internal improvements.