Fidessa experienced challenging market conditions in the first half with unexpectedly low volumes of trading in the equity markets and slow progress in market regulation, as well as the impact of the Japanese earthquake. Nevertheless, it has managed to win business particularly with larger customers who see efficiency gains from its financial asset trading systems and data. Growth is slightly down on the previous year but revenue is still up 7% (9% in constant currencies) to £137m, with an impressive 82% recurring. Adjusted operating profit (after removing the positive effect of the sale of its stake in Touchpaper) was up 8% (10% ccy) to £21.1m, maintaining 15% margins.
Fidessa grew its business across all regions: the UK was up 6%, USA 9%, Asia 7%. By division, it was the hosted (+10% to £75m) and buy-side (+13% to £12m) businesses that fared best with many customer preferring the SaaS option. The Enterprise division was fairly static at £50m turnover.
As to the outlook, Fidessa is expecting the financial markets to remain under pressure with significant macroeconomic uncertainty in the short term. Of course, that’s not all bad news for Fidessa, which sees opportunities as firms diversify and focus on cost efficiencies, increasing levels of automation. Over all, it’s expecting growth for the full year to be broadly similar to the first half. The longer term outlook looks better still with opportunities expected as clarity around regulation improves and markets in the developing world become more sophisticated.