In its annual results statement for the year ending December 2004, Financial Objects reports a decline in revenue of nine per cent to £9.5 million, from £10.4 million the previous year. Despite the slippage, the group managed to turn in a break-even result against a loss before tax of £12.1 million in 2003.

Much of the credit for the turnaround fall to savings made from the establishment of an offshore development facility in Bangalore for the group's activebank division, which currently employs 70 people. Financial Objects chairman Roger Foster says the firm is now set to offshore development for the back office Ibis product, raising the numbers employed in Bangalore to over 100 during the next 12 months.

Of the two core divisions, the legacy Ibis product turned in the better results, reporting stable revenues of £6.2 million (2003: £6.3m) as the programme to upgrade users to the new S2 platform kicked in. Activebank revenues declined to £3.3 million (2003: £4.1m) as resources were focused on the completion of onerous contracts.

Looking ahead, the company says the order book, at £8m, is in line with prior year and seven per cent up on 30th June 2004.

Chairman Foster remains circumspect: "We believe the market, which has been very difficult in recent years, now shows signs of having at least stabilised, providing us with an improved environment in which to sell our financial software products and services."

Shares in the vendor shipped 14% to 55 pence, losing the gains made on the back of a more upbeat preliminary statement at the beginning of March.