Raft International a supplier of risk software for the financial and energy markets, is reporting full year operating losses of £1.03 million, slightly down from the £1.07 million reported in 2003, as cost control measures compensated for a £1.3 million decline in annual turnover.
The vendor moved to reduce its costs by transferring all development staff to Mumbai as budget cuts and lengthy sales cycles hit prospects between August and December 2003.
Full year turnover to end October 2004 slipped to £7.3 million from £8.6 million in 2003, although improving conditions in the second half saw revenues return to a comparable level at £4.1 million (H1 2003: £4.4 million).
Raft has since moved to restructure its business into three distinct divisions - energy credit risk, operational risk and professional services - and is forecasting a return to profitability on the back of new blue chip client wins (in 2004, Barclays Capital and LloydsTSB were added to the existing op risk client base of Dresdner Kleinwort Wasserstein, ABN Amro and Abbey) and regulatory demands for greater investment in risk management solutions.
The new structure should also give the vendor the option to negotiate a partial sell-off should market conditions remain difficult. Raft called off takeover talks with a potential suitor in October 2003 after failing to agree a fair price for the entire issued share capital of the company.
By October 2004, Raft had £1.1 million in the bank (FY2003: £2.2 million) and no debt.