July 22 (Bloomberg) -- Brady Plc, a British maker of software for commodities trading and risk management, posted a 23 percent increase in first-half sales as new license deals and a reorganization of its Energy unit boosted performance.
The company’s recurring revenue rose 25 percent compared with a year earlier while total sales increased 23 percent, it said in a statement today. Recurring revenue was 57 percent of the total, compared with 55 percent in the corresponding period in 2012. Cambridge, England-based Brady signed six significant new license deals as total license revenue rose 9 percent. The stock gained 3.3 percent to 78.50 pence at 12:36 p.m. in London, the highest intraday price since May 30.
Slumping commodities markets have made the timing of securing new deals more challenging, Chief Executive Officer Gavin Lavelle said in the statement, while Brady has “a substantial pipeline of new opportunities” and is focused on managing its cost base. The restructuring of the Energy business unit has contributed to higher revenue after “two significant service deals.” the company said.
Brady’s trading update shows “encouraging growth,” Andrew Bryant, an analyst at Cenkos Securities Ltd, said in a note to investors. “The timing of winning deals is less certain but the pipeline remains sizeable and our forecasts remain unchanged ahead of interims in September.” Bryant maintained his buy recommendation with a price target of 115 pence.
Deals with Chile’s Codelco, the world’s largest copper producer, and a global aluminum producer endorse Brady’s position, Lavelle said.
There’s no sign of acquisitions slowing in the sector after software provider Triple Point Technology Inc.’s recent purchase by Ion Trading, Bryant said. Brady had revenue of 28 million pounds ($43 million) last year and its clients include financial institutions, miners and recycling companies.
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