Norkom predicts 20% profit increase

NORKOM Technologies is confident of ongoing profit growth, despite current global economic conditions, and has forecast a 20% increase in profits for its current full year, which runs until the end of March.

The Dublin-based company, which provides anti-fraud/money laundering software solutions to financial institutions, yesterday reported a 37% year-on-year increase in first half revenue to €24.2 million. Earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 30% to €4m. Gross profit for the six months to the end of September amounted to €14.9m — up 29% on the same period last year.

The addition of 10 new clients, a partnership with IBM to deliver new financial crime and compliance software solutions and its first deal in the Middle East with a contract with Dubai Islamic Bank were the highlights during Norkom’s first half.

However, Norkom’s chief executive, Paul Kerley said a stalling in market demand — brought on by disruptions such as forced mergers and de-mergers stemming from the credit crisis — would lead to higher volumes of order postponements going forward.

“Our commitment to profit growth, together with uncertainty in our core market, dictates we adopt a more prudent approach to expanding our cost base,” he said.

Mr Kerley added that new anti-fraud compliance regulations being introduced by European markets and hinted at by the incoming new US administration would increase demand for Norkom’s products and would act as long-term drivers of growth.

In terms of Norkom’s revenue breakdown, continental Europe and the US each make up more than 30%, with Asia-Pacific between 10% and 15% and the rest generated across Ireland, Britain and the rest of the world.