UK software house Gresham Computing - whose share price has rocketed on the promise of returns from delivery of a new real-time nostro service to the wholesale banking market - is reporting a 21% drop in first-half turnover to £4.9 million (H1 02: £6.2 million) but a 40% reduction in operating losses to £1.2 million.
The decrease in turnover was principally the result of a poor performance from Gresham's contract staff and recruitment agency.
The company is firmly pinning its future fortunes on the successful introduction of Cable & Wireless's real-time nostro service (C&WRTN), for which Gresham wrote the application software.
Gresham's stock has more than tripled in value since the announcement by C&W in May that ANZ, Barclays, JPMorgan Chase and Mizuho Corporate Bank had decided to adopt RTN as the standard infrastructure for sharing nostro account information between financial institutions and other organisations. Scheduled to be operational in October 2003, the four clearing banks say that they will act as a channel to market for the subscription-based utility and supply data for it.
Gresham CEO Andrew Walton-Green says: "Considerable progress has been made towards this goal and, at Sibos next month, the capabilities and competitive advantages of RTN will be demonstrated to the wider banking community."
Gresham chairman Sid Green says the service is now undergoing advanced operational testing in readiness for full deployment and continues to be well received by the market.
He says: "Cable & Wireless have indicated that discussions are advanced with a number of further major financial institutions regarding data provision and use of their service."
Revenue from C&WRTN will not be significant in 2003, says Green, but it will build significantly over the coming years and "has the potential to deliver the most substantial returns in the group's history".