Interim report January 1–June 30, 2008
Stable growth despite turbulent markets
Net revenue continued to improve and rose by SEK 19.6m, or 16%, compared to Q2 2007. Recurring revenue increased by SEK 24.8m, equal to 24%, and now makes up 93% of net revenue.
The annualized value of existing customer contracts grew by SEK 20.5m compared to Q1 2008. Of the increase, Orc’s operations in Asia Pacific accounted for SEK 9.6m, or 47%.
The level of reductions in existing customer contracts was lower than in the prior quarter.
The annualized value of existing customer contracts at the end of Q2 2008 was SEK 517.2m (433.7), up by SEK 83.5m, or 19%, compared to Q2 2007. On a fixed exchange rate basis, the increase was SEK 115.3m, or 27%.
April–June 2008
• Net revenue of SEK 138.8m (119.3)
• Revenue growth of 16% (11)
• Operating income of SEK 27.3m (26.8)
• Operating margin of 20% (22)
• Income after tax of SEK 17.7m (20.9)
• Basic earnings per share of SEK 1.17 (1.33)
January-June 2008
• Net revenue of SEK 275.3m (238.2)
• Revenue growth of 16% (22)
• Operating income of SEK 48.4m (56.9)
• Operating margin of 18% (24)
• Income after tax of SEK 32.9m (41.7)
• Basic earnings per share of SEK 2.16 (2.72)
CEO Thomas Bill comments:
Orc has continued its stable expansion in spite of the global credit crunch, and achieved growth of around SEK 20m in the order book during Q2. It is highly satisfying that sales have widely outpaced total customer contract reductions, a sign of strength in view of the turmoil that has plagued the financial markets in recent quarters.
Our solutions for trading and connectivity are benefiting from strong growth in derivatives trading, ongoing automation and expanding trading volumes.
Geographically, Asia Pacific was the top regional performer and posted the strongest order book growth of all regions during the quarter. In recent years Orc has established a position as a global company with a significant presence in the international financial markets, which has reduced dependency on the European region.
Our business model based predominantly on recurring revenue also contributes to good stability. Recurring revenue now makes up more than 90% of our total revenue and this share is rising further.
Despite unrest in the financial markets, we look forward to the second half of 2008 with confidence.
For the full year 2008 we expect to increase both our revenue and order book compared to 2007.
About Orc Software
Orc Software (SSE: ORC) is the leading global provider of powerful solutions for the worldwide financial industry in the critical areas of advanced derivatives trading and low latency connectivity. Orc’s competitive edge lies in its depth of knowledge of the derivatives trading world gained by deploying advanced solutions for sophisticated traders for over 20 years.
Orc Trading and Orc Connect provide the tools for making the best trading and connectivity decisions… strong analytics, unmatched market access, powerful automated trading functionality, high performance futures and options trading capabilities, ultra-low latency, and risk management.
Orc’s customers include leading investment banks, trading and market-making firms, exchanges, brokerage houses, institutional investors and hedge funds.
Orc provides timely sales and quality support services from its offices across EMEA, Americas and Asia Pacific.
For more information, please visit www.orcsoftware.com
Contact Information
CEO Thomas Bill, phone: +46 8 506 477 35
CFO Anders Berg, phone: +46 8 506 477 24