Good Fidessa results and Oracle buy-out rumours don't halt index slide

Good Fidessa results and Oracle buy-out rumours don't halt index slide

The Finextra50 Financial Technology Index closed last week down 5.6% to 54.16. Bucking the trend, Fidessa posted better than expected results, while India-listed Oracle FSS rose on buy-out rumours. But with Vasco Data Security and Morningstar both falling heavily after worse than expected results, and the banking sector taking fresh blows, it was a generally pessimistic week.

Losers

Security and authentication vendor Vasco Data Security was the index's worst performer last week, dropping 27.08% to $5.25.

The company, which saw 82% of its revenue in 2008 come from the banking sector, reported Q4 profit fell to $2.8 million, compared with $3.3 million, a year earlier. Revenue fell 7% to $28.9 million, while operating expenses rose 16% to $16.9 million.

'We experienced important delays in orders from banks in an unprecedented high number of our key markets,' COO Jan Valcke said in a conference call with analysts.

Given the uncertainty created by the continued turmoil in the worldwide economy, Vasco has decided to temporarily discontinue its practice of providing annual guidance.

Morningstar also dipped heavily at the end of last week on poor results. Its shares fell 18.37% to $28.00 by close of trading Friday. The supplier of software, online services and fund rating information posted net income of $19.3 million, or 39 cents a share, down 3.7 percent from $20.0 million, or 41 cents a share, a year ago. Analysts, on average, had expected earnings of 43 cents a share.

Revenue rose modestly to $119.3 million from $118.1 million, after the Chicago-based  company made six small acquisitions last year, but the firm now faces pressure to reduce costs.

Other companies to see significant falls include:

Gainers

Fidessa bucked the downward trend, gaining 20% to close last week at 720p as the dealing systems vendor posted better than expected full-year revenue and profit.

The group reported revenue up 40% at £189.1 million, with recurring revenue accounting for 77% of turnover as against 51% in 2007. Sell-side sales accounted for the bulk of recurring revenue value at £91 million. Buy-side trading brought in £12 million in sales, £27 million arose from connectivity and £17 million from market data.

Adjusted operating profit was up 46% to £26.8 million, excluding a £1 million charge to settle a long-running patent dispute with US vendor Lava Trading, and a £0.6 million receivable write off arising from the failure of Lehman Brothers. The unadjusted operating profit was up 36% to £22.5 million (2007: £16.6 million).

Oracle Financial Services Solutions ended Friday up 13.85% to Rs704.2 after local media reports that Oracle may make an open offer for the shares of the company at Rs 1000 per share. But in a letter to the National and Bombay exchanges, it stated, "The company is not aware of any such developments."

The only other firms to see strong rises last week were:

 

Index comparison



 

Methodology
More information on the Finextra50 Financial Technology Index methodology and constituent stocks can be found here.

 

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