OM, which is preparing for a merger with Finnish neighbour HEX, last month announced a restructuring of the Energy Markets business area and OM Technology's product portfolio as well as a concentration of operations to fewer offices in an effort to reduce annual costs by Skr578 million.

The initiative came against a backdrop of weak markets and difficult trading conditions. The company reports that levels of activity across all markets during the second quarter were low, with no major orders reported by the technology division.

The value of equity trading on Stockholmsbörsen fell by 20% year-on-year, while equity options trading fell by 56%. At the same time demand for technology services remained weak with Q2 order intake of Skr259 million compared to Skr221 million in the first quarter of the year.

The company is warning that third quarter technology revenues will remain depressed and are expected to be lower than the second quarter due to seasonal variations.

Commenting, Magnus Böcker, acting president and CEO states: "OM now needs to achieve sound profitability and reinforce market confidence in our operations. We expect no turnaround in our markets in the short term...The cost reduction measures that we are in the process of implementing will pave the way for a considerably stronger OM, with profitability in all business areas with effect from the first quarter 2004."

On the positive side, he pointed to the forthcoming merger with HEX, which is on course for completion in September, and the start of operations on EDX London, the new joint venture operation for trading OTC dervivatives with the London Stock Exchange.