Swiss banking systems vendor Temenos is reporting a 58% increase in sales of its T24 platform for Q1 2005 compared to a year ago, and is forecasting robust growth for the year ahead as banks look to replace legacy systems.
Temenos says the value of initial licence fees (ILF) for new T24 contracts secured in Q1 2005 was US$12m.
Temenos nonetheless struggled to improve on last year's first quarter, when sales were skewed by a large CoreBanking deal. Overall Ebitda for the first three months of 2005 was $4m, down from $7.3m last year. Profits were down to zero, compared to $3.4m a year ago.
Total revenues for Q1 2005 were $34.9m, down 14.2% on last year's $40.7m. But maintenance revenues increased to $11.3m in Q1 2005, up 27.3% on the comparable period last year. Service revenues increased by five per cent in the quarter.
Total expenses in Q1 2005 fell six per cent to $34.5m, compared to $36.7m in the year ago quarter.
Looking ahead, Temenos says its pipeline for the T24 product demonstrates strengthening markets with banks showing increasing commitment to replacement of old legacy systems. The vendor expects to secure sales ahead of target for the year. Temenos also expects to secure between two to four CoreBanking deals for 2005, including one in the first half of the year.
Andreas Andreades, chief executive, Temenos, says: "There is increasing evidence that the banking sector is looking to replace ageing legacy systems, and we expect continuing robust growth in core spending for retail and universal banks on a global basis over the next 12-18 months."
Temenos shares were up 4.63% to CHF7.01 in afternoon trading, although the price remains nearly 40% down on the year.