UK banking systems vendor Misys has talked down prospects for an upturn in trading conditions this financial year, as banks continue to bear down on budgets and costs.
In a trading statement to shareholders attending the company's AGM, Misys chairman Kevin Lomax says performance expectations in the current financial year remain unchanged, despite signs of increased levels of activity in banking and securities markets.
"The outlook for banks' IT spending is unclear and will remain so at least until budgets for 2004 are set over the next few months," he says. "Accordingly, it is still too early to predict the timing of an upturn in the banking software markets and we are not planning for a return to more buoyant conditions during this financial year."
Bank cutbacks have hit professional services revenues within banking and securities, says Lomax, with a "significant impact" on Misys' first-half results.
"We expect the trading performance of the division as a whole to make solid progress in the current year," continues Lomax. "Although this progress will be deferred to the second half as a result of the near term decline in professional services."
Conditions in the UK financial services market also remain difficult with results expected to be below those achieved last year. In April, Misys announced plans to consolidate and float its network of independent financial advisers under the name Sesame.
Referring to a continuing decline in the number of registered individuals within the network, Lomax comments: "The outlook for Sesame remains unchanged and we are confident that Sesame has a sound business model and that the decline in member numbers will be reversed."