Misys admits end to year 2000 bonanza

Software Chairman warns of slow period to come as vendor reportsprofit increase.

UK healthcare and banking software group Misys revealed a 39 per cent rise in annual profit, but conceded that the big money-making opportunities created by the millennium were over.

For the year ended 31 May, pre-tax profit rose to £124m, up from £89m from the same period last time. Analysts had previously predicted a figure of between £118m to £130m. Revenue climbed by 30 per cent to £582m from £448m.

But the results came with a warning that the business will be adversely affected because work involving the millennium bug will disappear. Kevin Lomax, chairman of Misys, admitted there will be "a potentially slower period".

Misys' banking and securities division, which accounts for about 60 per cent of group revenue and 70 per cent of group profit, has been reaping business from financial institutions demanding millennium compliant systems.

After year 2000, Lomax predicted that revenue opportunities will spring from Misys' internet service, due to start in early 2000. The two online financial services will receive a cash injection of about £50m, although neither are expected to generate profit for a number of years.

The first, a personal financial services (PFS) consumer portal, is aimed at helping customers make choices concerning life assurance, pensions and investment products. A portal aimed at independent financial consultants will provide value-added services to help them advise their own customers.

Tony Picardi, senior vice president of global software at IDC, said: "Nobody's making any money out of portals. However, the business is projected to grow and will pay off for a number of people, but why should it for a startup?

"There is so much out there already, but the financial advice may be good for those who are clueless," he added.

Lomax said government initiatives encouraging individuals to take more responsibility for their long-term financial planning meant there was a growing demand for independent professional advice. Misys intends to extend the service throughout Europe following the UK launch next year.