TORONTO, Nov. 7 /CNW/ - Algorithmics, a leading provider of risk management software solutions, today reported that revenue for the third quarter ending September 30, 2001 was $18.2 million (all figures USD), an increase of 42 percent over revenue of $12.8 million for the third quarter, 2000. For the first nine months of 2001, revenue was $50.4 million, an increase of 49 percent over the $33.7 million reported for the same period last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) and non-cash charges associated with financings and acquisitions, increased by $342,000 to $526,000 for the quarter, from $184,000 in Q3 2000.
EBITDA for the year-to-date totaled ($126,000), up from ($3.5 million) in the
corresponding period in 2000. Net income (loss) totaled for the quarter and
($24.5 million) for the nine-month period ending September 30, primarily due
to non-cash charges.
"Greater financial risk and increased volatility in world markets helped
Algorithmics to continue its solid growth, as we continue to capitalize on the
trend among banks to buy rather than build risk management solutions," said
Ron Dembo, President and Chief Executive Officer. "Regulatory pressures,
spearheaded by the latest BIS II guidelines, contributed to increased demand
among financial institutions worldwide for our integrated solutions for
market, credit, and liquidity risk management, as well as asset and liability
management (ALM) solutions. Clearly, the benefits of having a single, Mark-to-
Future(TM) based risk framework, which saves capital charges while meeting
both business and regulatory demands for 'best practice' processes and
systems, are being recognized."
Steve Wilson, Chief Financial Officer, said "We are very pleased with the
improvement in our operating results on a year-over-year basis. Not only are
we ahead of our plan for the year-to-date in terms of both revenue and EBITDA
profitability but we also continue to have excellent visibility going forward,
as our revenue backlog of signed deals for future delivery continues to grow.
We remain confident that 2001 will be the best in the company's history in
terms of financial performance, as we progress through Q4, which has always
been our busiest quarter of the year."
Current Clients Increase Purchases; New Clients Added "We continued to successfully execute our 'depth strategy,' by increasing sales to our existing clients, as well as adding new clients from among leading financial institutions. In addition to renewing their long-standing licenses, our current clients also purchased incremental products and services, moving closer to a 'Bank of the Future' architecture, wherein one, core risk engine supports many business activities and risk categories within the bank," said Michael Zerbs, VP of Research & Product Marketing. "The trend among clients to increase their business with us was also evident in the area of professional services, with our staff working on 65 projects compared to 49 for the same three-month period a year ago; again, mainly with existing clients. Increased sales to our base was complemented by our prospecting efforts, which saw more than a dozen new clients added to our client list, to date, in 2001," he added.
To accommodate the increasing business activity, in Q3 the company leased space in a second building in Toronto, close to the existing headquarters, and opened new offices in Sydney, Frankfurt and Vienna.