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Misys profit falls 22%
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January 25, 2001: 8:14 a.m. ET
Internet investment impacts on software company's earnings
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LONDON (CNNfn) - British software company Misys said Thursday first-half profit fell 22 percent as it increased investment in its Internet services start-up.
Net income for the six months to Nov. 30 dropped to £27 million ($39 million), or 4.7 pence a share, from £35 million, or 6p a share, a year ago. The company said revenue rose 20 percent to £413 million.
 The company, which makes software for the banking, insurance and healthcare industries, was bullish about its long-term growth prospects, saying its order intake was well ahead of last year. Shares in Misys rose 3.5 percent to 638p in early trade.
Chairman Kevin Lomax told Reuters Misys would get close to its 20 percent long-term earnings growth rate this year despite what seems like a very steep struggle.
"We've had virtually no growth in the first half overall, or very slow growth, so you have to do better than 20 percent in the second half to get to 20 percent overall," he said. "The first half does not look much different from last year but the trends are all strongly upwards."
Misys's confident outlook proved a fillip for rival software houses, which had been battered by profit warnings and a slowdown in the U.S. economy that had hit demand. CMG (CMG) rose 2.8 percent to 1052p, Logica (LOG) gained 1.2 percent and Sema (SEM) shot up 7.3 percent to 398 pence in midday trade.
Misys said it saw little evidence so far that the slowdown in the U.S. economy was affecting demand for its products.
Misys invested 11 million pounds over the half year in its Internet ventures, the latest of which -- a consumer financial services portal called "theformula" -- was launched in November, at a time when many others scaled back online ventures.
It also runs Screentrade, a site where consumers can compare insurance offers, and an online service for British independent financial advisers.
"We are continuing to explore whether and, if so, on what basis we should form one or more partnership arrangements with candidates now identified," Misys said in a statement.
--from staff and wire reports 
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