UK trading technology vendor royalblue is reporting first half profits ahead of expectations after recording strong organic growth across all its operations.
The company has posted a 20% jump in first half revenues to £34.1m, compared to £28.5m a year ago, and a 17% increase in pre-tax profit to £4.8m from £4.1m a year earlier. Market analysts had forecast a pre-tax profit in the region of £3.7 million.
The vendor says recurring revenue rose 30% in H1 and now represents 66% of its total income. Revenue from its hosted Fidessa services grew by 77% to £10.5m, and now accounts for 31% of total revenue. The company is also reporting an 18% rise in consultancy revenue.
Royalblue says it has also seen a marked increase in sales of its Fidessa workstation, with four "significant deals" signed in the first half which are expected to be worth over $30 million over the next four years.
Chris Aspinwall, royalblue chief executive, says the firm is experiencing the strongest demand that it has seen for several years and looking ahead, he expects strong trading conditions to continue for the remainder of 2005.
"The general improvement in consultancy and continued growth in recurring revenue should result in overall revenue growth for 2005 of more than double that achieved in 2004," he says.
The company says it is also seeing a strong demand for global trading functionality and is bringing forward its plans to provide global data and is also expanding its data centres and network more rapidly.
The vendor expects to remain within the guidance given at the year end that the combined effect of these plans will add approximately £2 million to the operating costs during 2005 and result in a reduction of the operating margin. But the change to IFRS means it now expects this reduction to be around one percentage point rather than two percentage points.
Royalblue shares rose 4.10% to 590.00 pence in morning trading.