AVEVA 1H07 revenue, pretax profit maintains hectic pace of growth thanks to R&D spend, bouyant markets
Star Silicon Fen performer AVEVA Group plc (AVV.L), one of the world's leading providers of engineering data and design IT systems, reported strong growth in revenues and profits on the back of buoyant marine, oil, gas and power markets in the six months ended 30 September.
Chairman Nick Prest (pictured) said: "AVEVA has built an excellent reputation amongst the world's leading engineering companies for innovative products and first class support.
“Our significant investment in R&D and resulting launch of new products into strongly growing markets position the Company for further expansion. In addition, the maturing of the new AVEVA NET products will provide an additional platform for sales into the Owner / Operator market."
However, the Group’s share price slid 48p to 1100p in early trading, after a period of steady growth since September lows of around 800p. It is now valued at around £740m.
Mr Prest said operating margins continued to improve in 1H and were 28% in the first half, up from 27% in 1H06.
“Margins over recent periods have increased and are being driven by growth in sales, and in particular Initial fee income. Offsetting this, however, has been the Company's continued investment across the business, in particular in R & D, which has helped support the growth rates seen over recent periods,” he said.
The Group's strong first half trading benefited from increased contribution from all regions.
Investment in R & D was 18% of turnover at £10.2m, compared to £7.2m in 1H2006.
Mr Prest said the investment in R & D and launch of new products into strongly growing markets positioned AVEVA for further expansion. In addition, the maturing of the new AVEVA NET products will provide an additional platform for sales into the Owner / Operator market.
12th November 2007
