The value of second-quarter licence sales recorded by Swiss vendor Temenos is running 9.4% ahead of target at $14 million, prompting speculation that the European market for core banking software may be emerging from the doldrums.
Initial licence fee (ILF) signings comprised 72% new licences and 28% upgrade sales to existing customers compared to 75% and 25% for the previous quarter.
Temenos says it exceeded targets in Europe, CIS and in the Middle East, with Asia Pacific and the US markets continuing to underperform.
George Koukis, Temenos chairman and CEO, says: "The business climate continues to remain challenging in terms of spending amongst our client and prospect base. We have experienced pressure on pricing however, we believe that a level of stability is returning to the market."
During the quarter, new single and multiple sites licence contracts were signed with Standard Chartered Grindlays (Offshore), the Vatican, Kuwait Investment Company, Post Bank of Iran as well as a European government agency.
Revenues were above target for the quarter, pushing the group back to profitability.
Anticipated 2003 revenues originating from business closed to date represent approximately 100% of target revenues of $130 million, says Koukis, who forecasts earnings before tax and deductions of approximately $25 million.
Temenos last year reported an operating loss of $44.4 million.