GL TRADE, the Paris-based supplier of trading technology, says its first half turnover of EUR72.8 million was up 16.5% on last year. This includes the activities of Misys Securities Trading Systems (MSTS) and GLESIA, acquired towards the end of 2003. At constant exchange rates, sales grew 19.2%.
Turnover increased considerably in Asia, as a result of the combined impact of the economic upswing and of the MSTS acquisition. During the first half of 2004, turnover outside France accounted for 79% of total turnover, up from 71% in 2003.
UK recorded growth of 34%, and now accounts for 26% of group turnover, up from 22% in the first half of 2003. This is mainly due to the acquisition of MSTS last November, adding first-half 2004 sales of EUR1m in trading solutions and EUR3.2m in back-office solutions.
France now accounts for just 21% of turnover, down 16% (-EUR3m). This decrease is because of a number of contract renegotiations as a result of cost-cutting at customer sites, mergers or business relocations. This decline was partially offset by the re-signing of some of the same contracts by other GL Trade subsidiaries. However, the erosion of the historic retail broadcast activities (Minitel, TV) continues.
Italy has become GL TRADE’s third-largest market accounting for 13% of group turnover following the resumption of direct control over distribution in Italy. SIA, the previous distributor of the GL TRADE software, became a 49% shareholder in GLESIA, the current Italian subsidiary, earlier in 2004. Business across the rest of Europe remained stable.
Business in the Americas was up 5% in USD dollars, but fell back 4% in Euros due to the steady decline in the US dollar.
SIA accounted for 12% of Group turnover and announced an 88% increase thanks to the combined impact of the acquisition of MSTS’ activities in Japan and Hong Kong (EUR2.5m in the first half of 2004) and the signature of new contracts (EUR1.5m).
Based upon this performance, GL TRADE confirms its previously forecast growth target of 15- 20% at constant exchange rates for the year as a whole. The MSTS and GLESIA profitability levels have not been as high as those of the GL TRADE group as a whole because of a number of one-off costs of restructuring and integration. This process has now been largely completed and these activities are expected to operate at EBITA levels in the region of 19% in the second half of 2004.
Thanks to exceptional elements, net profit before goodwill amortisation for the first half of 2004 should be in line with the forecast margin of between 12 and 13%. First half results will be issued on August 25th and will be presented in full at the analysts meeting (SFAF) to be held on 1st September 2004.
In late June, at the time as Reuters’ disposal of its 34% interest in GL TRADE’s shares, GL TRADE acquired an 8% stake in its own capital. As announced at the time, GL TRADE’s Board meeting, held today decided to cancel these shares, reducing its shareholders’ equity by EUR21m. Following this share cancellation, GL TRADE now has 9,512,525 shares outstanding. The free float stands at 32.3% of the share capital. This transaction will have an earnings-enhancing impact for all shareholders.